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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 10-Q
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period endedSeptember 30, 2026
Or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 001-16209

 archlogorgbsolida36.jpg
ARCH CAPITAL GROUP LTD.
(Exact name of registrant as specified in its charter)
Bermuda98-0374481
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
Waterloo House, Ground Floor
100 Pitts Bay Road, PembrokeHM 08,Bermuda(441)278-9250
(Address of principal executive offices)(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of each classTrading Symbol (s)Name of each exchange on which registered
Common shares, $0.0011 par value per shareACGLNASDAQ Stock Market
Depositary shares, each representing a 1/1000th interest in a 5.45% Series F preferred share
ACGLO
NASDAQ Stock Market
Depositary shares, each representing a 1/1000th interest in a 4.55% Series G preferred share
ACGLN
NASDAQ Stock Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑     No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer ☑ Accelerated Filer ☐ Non-accelerated Filer ☐ Smaller reporting company ☐ Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of October 29, 2026, there were 325,525,336 common shares, $0.0011 par value per share, of the registrant outstanding.

Table of Contents
ARCH CAPITAL GROUP LTD.
 
INDEX TO FORM 10-Q
 
Page No.
 2
Item 1.
 4
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
ARCH CAPITAL
 1
2026 THIRD QUARTER FORM 10-Q
Table of Contents
PART I. FINANCIAL INFORMATION
Cautionary Note Regarding Forward-Looking Statements 
The Private Securities Litigation Reform Act of 1995 (“PSLRA”) provides a “safe harbor” for forward-looking statements. This report or any other written or oral statements made by or on behalf of us may include forward-looking statements, which reflect our current views with respect to future events and financial performance. All statements other than statements of historical fact included in or incorporated by reference in this report are forward-looking statements. Forward-looking statements, for purposes of the PSLRA or otherwise, can generally be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” and similar statements of a future or forward-looking nature or their negative or variations or similar terminology.
Forward-looking statements reflect our current assessment of risks and uncertainties. Actual events and results may differ materially from those expressed or implied in these statements. Important factors that could cause actual events or results to differ materially from those indicated in such statements are discussed below and elsewhere in this report and in our periodic reports filed with the Securities and Exchange Commission (“SEC”), and include:
•our ability to successfully implement our business strategy during “soft” as well as “hard” markets;
•acceptance of our business strategy, security and financial condition by rating agencies and regulators, as well as by brokers and our insureds and reinsureds;
•our ability to consummate acquisitions and integrate the business we have acquired or may acquire into our existing operations;
•our ability to maintain or improve our ratings, which may be affected by our ability to raise additional equity or debt financings, by ratings agencies’ existing or new policies and practices, as well as other factors described herein;
•general economic and market conditions (including inflation, interest rates, unemployment, housing prices, foreign currency exchange rates, prevailing credit terms, tariffs, geopolitical instability and conflict and the depth and duration of a recession) and conditions specific to the reinsurance and insurance markets in which we operate;
•competition, including increased competition, on the basis of pricing, capacity (including alternative sources of capital), coverage terms, or other factors;
•developments in the global financial and capital markets and our access to such markets;
•our ability to successfully enhance, integrate and maintain operating procedures (including information technology) to effectively support our current and new business;
•the loss and addition of key personnel;
•material differences between actual and expected assessments for guaranty funds and mandatory pooling arrangements;
•accuracy of those estimates and judgments utilized in the preparation of our financial statements, including those related to revenue recognition, insurance and other reserves, reinsurance recoverables, investment valuations, intangible assets, bad debts, income taxes, deferred income tax assets, contingencies and litigation, and any determination to use the deposit method of accounting;
•greater than expected loss ratios on business written by us and adverse development on claim and/or claim expense liabilities related to business written by our insurance, reinsurance and mortgage subsidiaries;
•the adequacy of the Company’s loss reserves;
•severity and/or frequency of losses;
•greater frequency or severity of unpredictable natural and man-made catastrophic events;
•claims for natural catastrophic events or severe economic events in our insurance, reinsurance and mortgage businesses could cause large losses and substantial volatility in our results of operations;
•availability to us of reinsurance to manage our net exposure and the cost of such reinsurance;
•the failure of reinsurers, managing general agents, third party administrators or others to meet their obligations to us;
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Table of Contents
•the timing of loss payments being faster or the receipt of reinsurance recoverables being slower than anticipated by us;
•our investment performance, including legislative or regulatory developments that may adversely affect the fair value of our investments;
•changes in general economic conditions, resulting in downgrades of U.S. securities or sovereign debt by credit rating agencies, which could affect our business, financial condition and results of operations;
•an incident, disruption in operations or other cyber event caused by a cyber attack, inadvertent error, the use of artificial intelligence technologies or other technology on our systems or those of our business partners and service providers, which could negatively impact our business and/or expose us to litigation;
•the effect of climate change on our business;
•the effect of contagious diseases or a pandemic on our business;
•acts of terrorism, political unrest and other hostilities or other unforecasted and unpredictable events caused by humans;
•the volatility of our shareholders’ equity from foreign currency fluctuations, which could increase due to us not matching portions of our projected liabilities in foreign currencies with investments in the same currencies;
•changes in accounting principles or policies or in our application of such accounting principles or policies;
•changes in the political environment of certain countries in which we operate or underwrite business;
•statutory or regulatory developments, including as to tax matters and insurance and other regulatory matters such as the adoption of legislation that affects Bermuda-headquartered companies and/or Bermuda-based insurers or reinsurers and/or changes in regulations or tax laws applicable to us, our subsidiaries, brokers or customers, including the implementation of the Organization for Economic Cooperation and Development (“OECD”) Pillar I and Pillar II initiatives and the enactment of Bermuda corporate income tax; and
•the other matters set forth under Item 1A “Risk Factors,” Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other sections of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on February 26, 2026 and of the Company’s latest Quarterly Reports on Form 10-Q, as well as the other factors set forth in the Company’s other documents on file with the SEC, and management’s response to any of the aforementioned factors.
All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with other cautionary statements that are included herein or elsewhere. The Company’s forward-looking statements speak only as of the date of this report or as of the date they are made, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 

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Table of Contents
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
Page No.
September 30, 2026 and December 31, 2025 (unaudited)
For the three and nine month periods ended September 30, 2026 and 2025 (unaudited)
For the three and nine month periods ended September 30, 2026 and 2025 (unaudited)
For the three and nine month periods ended September 30, 2026 and 2025 (unaudited)
For the nine month periods ended September 30, 2026 and 2025 (unaudited)
Notes to Consolidated Financial Statements (unaudited)

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Table of Contents
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(U.S. dollars and shares in millions)
(Unaudited)
September 30,
2026		December 31,
2025
Assets
Investments:
Fixed maturities available for sale, at fair value (amortized cost: $33,148 and $32,329; net of allowance for credit losses: $19 and $20)
$32,119 $32,426 
Short-term investments available for sale, at fair value (amortized cost: $3,256 and $2,624; net of allowance for credit losses: $0 and $0)
3,253 2,625 
Equity securities, at fair value2,396 1,864 
Other investments, at fair value3,364 3,136 
Investments accounted for using the equity method7,126 6,453 
Total investments48,258 46,504 
Cash1,152 993 
Accrued investment income334 338 
Investment in operating affiliates1,338 1,313 
Premiums receivable (net of allowance for credit losses: $41 and $43)
6,919 5,723 
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses (net of allowance for credit losses: $19 and $17)
10,253 9,526 
Contractholder receivables (net of allowance for credit losses: $7 and $7)
2,357 2,270 
Ceded unearned premiums3,557 2,659 
Deferred acquisition costs1,767 1,717 
Receivable for securities sold123 180 
Goodwill and intangible assets1,133 1,222 
Other assets6,885 6,796 
Total assets$84,076 $79,241 
Liabilities
Reserve for losses and loss adjustment expenses$35,505 $33,547 
Unearned premiums11,208 10,100 
Reinsurance balances payable3,045 2,320 
Contractholder payables2,364 2,277 
Collateral held for insured obligations244 237 
Senior notes4,286 2,729 
Payable for securities purchased325 308 
Other liabilities4,107 3,517 
Total liabilities61,084 55,035 
Commitments and contingencies (refer to Note 11)
Shareholders' Equity
Non-cumulative preferred shares830 830 
Common shares ($0.0011 par, shares issued: 603.0 and 599.8)
1 1 
Additional paid-in capital2,906 2,735 
Retained earnings30,154 27,045 
Accumulated other comprehensive income (loss), net of deferred income tax(1,076)5 
Common shares held in treasury, at cost (shares: 276.6 and 240.8)
(9,823)(6,410)
Total shareholders' equity available to Arch22,992 24,206 
Total liabilities and shareholders' equity$84,076 $79,241 
See Notes to Consolidated Financial Statements

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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(U.S. dollars and shares in millions, except per share data)
(Unaudited)(Unaudited)
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Revenues
Net premiums earned$4,014 $4,285 $11,985 $12,810 
Net investment income451 408 1,276 1,191 
Net realized gains (losses)(99)210 (203)442 
Other underwriting income61 50 177 165 
Equity in net income of investments accounted for using the equity method224 134 580 349 
Other income (loss)4 22 29 38 
Total revenues4,655 5,109 13,844 14,995 
Expenses
Losses and loss adjustment expenses2,206 2,200 6,491 7,090 
Acquisition expenses712 786 2,160 2,374 
Other operating expenses455 478 1,424 1,405 
Corporate expenses22 49 115 156 
Amortization of intangible assets30 49 90 146 
Interest expense62 37 143 110 
Net foreign exchange (gains) losses(18)7 (49)122 
Total expenses3,469 3,606 10,374 11,403 
Income (loss) before income taxes and income (loss) from operating affiliates1,186 1,503 3,470 3,592 
Income tax (expense) benefit(184)(215)(446)(550)
Income (loss) from operating affiliates33 62 115 119 
Net income (loss) available to Arch1,035 1,350 3,139 3,161 
Preferred dividends(10)(10)(30)(30)
Net income (loss) available to Arch common shareholders$1,025 $1,340 $3,109 $3,131 
Net income per common share and common share equivalent
Basic$3.05 $3.63 $9.04 $8.43 
Diluted$3.00 $3.56 $8.89 $8.26 
Weighted average common shares and common share equivalents outstanding
Basic335.8 369.0 344.0 371.4 
Diluted341.4 376.1 349.7 379.1 



See Notes to Consolidated Financial Statements

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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(U.S. dollars in millions)
(Unaudited)(Unaudited)
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Comprehensive Income
Net income (loss)$1,035 $1,350 $3,139 $3,161 
Other comprehensive income (loss), net of deferred income tax
Unrealized appreciation (decline) in value of available-for-sale investments:
Unrealized holding gains (losses) arising during period(724)88 (1,157)625 
Reclassification of net realized (gains) losses, included in net income (loss)67 (41)91 4 
Foreign currency translation adjustments(6)1 (15)91 
Comprehensive income (loss) available to Arch$372 $1,398 $2,058 $3,881 
See Notes to Consolidated Financial Statements

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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(U.S. dollars in millions)

(Unaudited)(Unaudited)
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Non-cumulative preferred shares
Balance at beginning and end of period$830 $830 $830 $830 
Common shares
Balance at beginning and end of period1 1 1 1 
Additional paid-in capital
Balance at beginning of period2,873 2,660 2,735 2,510 
Amortization of share-based compensation20 25 117 124 
Other changes13 (3)54 48 
Balance at end of period2,906 2,682 2,906 2,682 
Retained earnings
Balance at beginning of period29,129 24,477 27,045 22,686 
Net income (loss)1,035 1,350 3,139 3,161 
Preferred share dividends(10)(10)(30)(30)
Balance at end of period30,154 25,817 30,154 25,817 
Accumulated other comprehensive income (loss), net of deferred income tax
Balance at beginning of period(413)(48)5 (720)
Unrealized appreciation (decline) in value of available-for-sale investments, net of deferred income tax:
Balance at beginning of period(275)75 134 (507)
Unrealized holding gains (losses) during period, net of reclassification adjustment(657)47 (1,066)629 
Balance at end of period(932)122 (932)122 
Foreign currency translation adjustments, net of deferred income tax:
Balance at beginning of period(138)(123)(129)(213)
Foreign currency translation adjustments(6)1 (15)91 
Balance at end of period(144)(122)(144)(122)
Balance at end of period(1,076)— (1,076)— 
Common shares held in treasury, at cost
Balance at beginning of period(8,390)(4,879)(6,410)(4,487)
Shares repurchased for treasury(1,433)(732)(3,413)(1,124)
Balance at end of period(9,823)(5,611)(9,823)(5,611)
Total shareholders’ equity$22,992 $23,719 $22,992 $23,719 
See Notes to Consolidated Financial Statements

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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in millions)
(Unaudited)
Nine Months Ended
September 30,
20262025
Operating Activities
Net income (loss)$3,139 $3,161 
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Net realized (gains) losses72 (433)
Equity in net (income) or loss of investments accounted for using the equity method and other income or loss(447)(265)
Amortization of intangible assets90 146 
Share-based compensation117 124 
Changes in:
Reserve for losses and loss adjustment expenses, net of unpaid losses and loss adjustment expenses recoverable1,478 2,020 
Unearned premiums, net of ceded unearned premiums257 17 
Premiums receivable(1,216)(693)
Deferred acquisition costs(23)33 
Reinsurance balances payable728 456 
Deferred income tax assets, net183 155 
Other items, net(109)47 
Net cash provided by operating activities4,269 4,768 
Investing Activities
Purchases of fixed maturity investments(28,282)(28,187)
Purchases of equity securities(874)(1,264)
Purchases of other investments(1,376)(1,745)
Proceeds from sales of fixed maturity investments24,579 22,258 
Proceeds from sales of equity securities650 1,324 
Proceeds from sales, redemptions and maturities of other investments818 1,427 
Proceeds from redemptions and maturities of fixed maturity investments2,756 1,801 
Net settlements of derivative instruments(130)275 
Net (purchases) sales of short-term investments(607)530 
Purchases of fixed assets(33)(33)
Other(26)(5)
Net cash used for investing activities(2,525)(3,619)
Financing Activities
Purchases of common shares under share repurchase program(3,382)(1,091)
Proceeds from common shares issued, net21 20 
Proceeds from borrowings, net1,971 — 
Repayments of borrowings(398)— 
Common dividends paid(5)(7)
Preferred dividends paid(30)(30)
Other(19)(4)
Net cash used for financing activities(1,842)(1,112)
Effects of exchange rate changes on foreign currency cash and restricted cash8 57 
Increase (decrease) in cash and restricted cash(90)94 
Cash and restricted cash, beginning of year2,067 1,760 
Cash and restricted cash, end of period$1,977 $1,854 
Income taxes paid (received)303 315 
Interest paid65 64 

See Notes to Consolidated Financial Statements

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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.    Basis of Presentation and Recent Accounting Pronouncements
General
Arch Capital Group Ltd. (“Arch Capital”) is a publicly listed Bermuda exempted company which provides insurance, reinsurance and mortgage insurance on a worldwide basis through its wholly-owned subsidiaries. As used herein, the “Company” and/or “Arch” means Arch Capital and its subsidiaries.
Basis of Presentation
The interim consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). All significant intercompany transactions and balances have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. In the opinion of management, the accompanying unaudited interim consolidated financial statements reflect all adjustments (consisting of normally recurring accruals) necessary for a fair statement of results on an interim basis. The results of any interim period are not necessarily indicative of the results for a full year or any future periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted; however, management believes that the disclosures are adequate to make the information presented not misleading. This report should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”), including the Company’s audited consolidated financial statements and related notes.
The Company has reclassified the presentation of certain prior year information to conform to the current presentation. Such reclassifications had no effect on the Company’s net income, comprehensive income, shareholders’ equity or cash flows. All amounts are in millions, except per share amounts, unless otherwise noted.
Recent Accounting Pronouncements
Recently Issued Accounting Standards Adopted
The Company early adopted ASU 2025-06, “Intangibles—Goodwill and Other—Internal–Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software,” which was issued in September 2025, and applied the guidance prospectively. The new guidance amended the accounting for internal-use software by eliminating references to software development project stages. Under the revised standard, entities must capitalize software costs when (i) management has authorized and committed funding for the project, and (ii) it is probable that the project will be completed and the software will function as intended. The update also clarifies that both internal and external training costs, as well as maintenance costs, must be expensed as incurred. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements and related disclosures.
For information regarding additional accounting standards that the Company has not yet adopted, see note 3(u), “Significant Accounting Policies—Recent Accounting Pronouncements,” of the notes to consolidated financial statements in the Company’s 2025 Form 10-K.
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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
2.    Acquisition
On August 1, 2024, the Company completed the acquisition of the U.S MidCorp and Entertainment insurance business from Allianz (“MCE Acquisition”). This business is written by Fireman’s Fund Insurance Company, an affiliate of Allianz, and its subsidiaries (collectively, the “Business Entities”), in each case, relating to relevant policies with accident years 2016 and onwards (collectively, the “Business”), as well as certain assets of Allianz and its affiliates related to the Business. In connection with the acquisition of the Business, the Company also entered into certain reinsurance agreements relating to the Business and the Business Entities and other agreements providing for administration and other services for the Business Entities by the Company for the applicable policies being reinsured following the closing. The acquisition of the Business is an important part of the Company’s growth strategy, and provides a ballast to our existing insurance business. It further enhances the Company’s capabilities in the U.S. middle markets and represents an attractive way to enter a new niche entertainment insurance market.
Aggregate cash consideration for the transaction was $450 million. Direct costs related to the acquisition were immaterial, and were expensed as incurred. These included one-time costs that were directly attributable to third party consulting fees and other professional and legal fees related to the acquisition. Such costs are included within ‘corporate expenses’ in the consolidated statement of income. The Business acquired is included within the Company’s insurance segment beginning from the acquisition date.
The MCE Acquisition was accounted for as a business combination under FASB Accounting Standards Codification Topic 805, Business Combinations (“Topic 805”). Pursuant to Topic 805, the Company allocated the MCE Acquisition purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values was recorded to goodwill. During the measurement period, the Company adjusted the provisional amounts to reflect new information obtained about facts and circumstances that existed as of the acquisition date, which, if known, would have affected the measurement of the amounts recognized as of that date. Such adjustments impacted certain identifiable assets acquired and liabilities assumed, resulting in a decrease to net assets acquired and a corresponding increase to goodwill of $10 million. The Company completed the analysis of the fair value of the assets, liabilities assumed and the related allocation of the purchase price during the 2025 second quarter.

The following table summarizes the Company’s allocation of the purchase price to the acquired assets and liabilities assumed based on estimated fair values on August 1, 2024.
TotalUseful Life
Purchase price
Cash paid (a)$450 
Assets Acquired
Cash and investments, at fair value$2,332 
Premiums receivable, net of commissions224
Intangible asset -- distribution relationships22010 years
Intangible asset -- value of business acquired165
1-2 years
Intangible asset -- other (1)180
5-7 years
Other assets acquired175
Total assets acquired$3,296 
Liabilities Acquired
Reserves for losses and loss adjustment expenses $2,468 
Unearned premiums636
Other liabilities acquired18
Total liabilities acquired3,122 
Identifiable net assets acquired (b)$174 
Goodwill (a) - (b)$276 
(1)    Includes $130 million related to the net fair value adjustment to reserves for loss and loss adjustment expenses on August 1, 2024.
The Company recognized goodwill of $276 million that is primarily attributed to the expanded presence and long-term growth opportunities in the insurance market provided by this strategic acquisition. Approximately $555 million of the acquired goodwill and intangibles is expected to be deductible for income tax purposes. At the date of the acquisition, the Company established a net deferred tax asset of $24 million related to the estimated fair value of reserves for losses and loss adjustment expenses and unearned premiums.
Intangible assets resulting from the acquisition are amortized as part of ‘amortization of intangible assets’ in the Company’s consolidated statements of income. The significant fair value adjustments and related future amortization are as follows:
Value of business acquired (“VOBA”)— which represents the present value of the expected underwriting profit within the unearned premium liability, less costs to service the related policies and a risk premium. The fair value of VOBA was determined after taking into consideration certain key assumptions, including the estimated cost of capital, investment yield, loss ratio and related expenses.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Reserves for losses and loss adjustment expenses—to reflect a decrease related to the present value of the reserve for losses and loss adjustment expenses based on the estimated payout patterns, partially offset by an increase in losses and loss adjustment expenses related to the estimated market based risk margin. The risk margin represents the estimated costs of capital required by a market participant to assume the losses and loss adjustment expenses. The fair value of the reserve for losses and loss adjustment expenses was determined after taking into consideration certain key assumptions, including the estimated cost of capital, and investment yield.
Distribution relationships—the value of the distribution relationships was determined after taking into consideration certain key assumptions, including the estimated cost of capital, investment yield, retention rates, loss ratios, related expenses and effective tax rates that would impact the expected cash flows from Business policies written on a go forward basis.
The results of the acquired Business have been included in the Company’s consolidated financial statements beginning as of their acquisition date. It is impracticable to provide historical supplemental pro forma financial information along with revenue and earnings subsequent to the acquisition due to a variety of factors, including access to historical information and the operations of acquirees being integrated within the Company shortly after closing and not operating as discrete operations within the Company’s organizational structure.
Premier Dealer Holding Corp.
On October 30, 2026, the Company announced that it has entered into an agreement to acquire Premier Dealer Holding Corp., a Dublin, Ohio-based provider of automotive finance and insurance product services. This transaction is subject to regulatory approvals and satisfaction of other customary closing conditions.
3.    Share Transactions
Share Repurchases
The Board of Directors of Arch Capital (“the Board”) has authorized the investment in Arch Capital’s common shares through a share repurchase program. Since the inception of the share repurchase program, Arch Capital has repurchased 490.5 million common shares for an aggregate purchase price of $11.2 billion. For the nine months ended September 30, 2026, Arch Capital repurchased 35.5 million common shares under the share repurchase program with an aggregate purchase price of approximately $3.4 billion. Arch Capital repurchased 12.3 million common shares under the share repurchase program with an aggregate purchase price of approximately $1.1 billion during the nine months ended September 30, 2025. At September 30, 2026, $725 million of share repurchases were available under the program. From October 1 through October 30, 2026, the Company repurchased approximately 1.1 million common shares for an aggregate purchase price of $102 million.
On April 19, 2026, the Company increased its authorization for its existing share repurchase program by $3.0 billion, which, as in the past, may be effected from time to time in open market or privately negotiated transactions. The timing and amount of the repurchase transactions under this program will depend on a variety of factors, including market conditions and corporate and regulatory considerations.




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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
4.    Earnings Per Common Share
The following table sets forth the computation of basic and diluted earnings per common share:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Numerator:
Net income (loss) available to Arch$1,035 $1,350 $3,139 $3,161 
Preferred dividends(10)(10)(30)(30)
Net income (loss) available to Arch common shareholders$1,025 $1,340 $3,109 $3,131 
Denominator:
Weighted average common shares and common share equivalents outstanding — basic335.8 369.0 344.0 371.4 
Effect of dilutive common share equivalents:
Nonvested restricted shares1.6 1.7 1.4 1.6 
Stock options (1)4.0 5.4 4.3 6.1 
Weighted average common shares and common share equivalents outstanding — diluted341.4 376.1 349.7 379.1 
Earnings per common share:
Basic$3.05 $3.63 $9.04 $8.43 
Diluted$3.00 $3.56 $8.89 $8.26 
(1)    Certain stock options were not included in the computation of diluted earnings per share where the exercise price of the stock options exceeded the average market price and would have been anti-dilutive or where, when applying the treasury stock method to in-the-money options, the sum of the proceeds, including unrecognized compensation, exceeded the average market price and would have been anti-dilutive. For the 2026 third quarter and 2025 third quarter, the number of stock options excluded were 1.8 million and 2.4 million, respectively. For the nine months ended September 30, 2026 and 2025, the number of stock options excluded were 2.4 million and 2.4 million, respectively.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
5.    Segment Information
The Company’s insurance, reinsurance and mortgage segments each have managers who are responsible for the overall profitability of their respective segments and who are directly accountable to the Company’s chief operating decision makers (“CODMs”), the Chief Executive Officer of Arch Capital and the Chief Financial Officer and Treasurer of Arch Capital. The CODMs do not assess performance, measure return on equity or make resource allocation decisions on a line of business basis. Management measures segment performance for its three segments based on underwriting income or loss. The Company does not manage its assets by segment, with the exception of goodwill and intangible assets and accordingly investment income is not allocated to each underwriting segment.
The Company has determined its segments using the management approach described in accounting guidance regarding disclosures about segments of an enterprise and related information. The accounting policies of the segments are the same as those used for the preparation of the Company’s consolidated financial statements. Intersegment business is allocated to the segment accountable for the underwriting results.
The Company’s insurance segment primarily consists of commercial insurance lines of business, with a focus on specialty insurance products. These products are mainly offered in North America, Bermuda, the United Kingdom, continental Europe and Australia. Products offered in North America include: commercial automobile; commercial multi‐peril; other liability—claims made, which includes financial and professional lines; other liability—occurrence, which includes admitted and excess and surplus casualty lines; property and short-tail specialty; workers compensation; and other. Products offered across the Company’s International units include: property and short-tail specialty; and casualty and other.
The Company’s reinsurance segment offers reinsurance products on a worldwide basis. Product lines of business include: casualty; marine and aviation; property catastrophe; property excluding property catastrophe; specialty; and other.
The Company’s mortgage segment consists of U.S. primary mortgage insurance business written predominantly on loans sold to the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), each a government sponsored entity (“GSE”) and also through non GSE approved entities (combined “Arch MI U.S.”); reinsurance and underwriting services related to U.S. credit-risk transfer (“CRT”) business which are predominately with the GSEs and other U.S. mortgage reinsurance transactions; and international mortgage insurance and reinsurance business covering loans primarily in Australia and Europe.
The Company’s results also include net investment income, net realized gains or losses (which include, but are not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, other income (loss), corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income tax items, income or loss from operating affiliates and items related to the Company’s non-cumulative preferred shares.
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 14
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following tables summarize the Company’s underwriting income or loss by segment, together with a reconciliation of underwriting income or loss to net income available to Arch common shareholders:
Three Months Ended
September 30, 2026
InsuranceReinsuranceMortgageTotal
Gross premiums written (1)$2,766 $2,313 $316 $5,391 
Premiums ceded (1)(760)(737)(53)(1,546)
Net premiums written2,006 1,576 263 3,845 
Change in unearned premiums(69)231 7 169 
Net premiums earned1,937 1,807 270 4,014 
Other underwriting income (2)15 43 3 61 
Losses and loss adjustment expenses(1,178)(1,010)(18)(2,206)
Acquisition expenses(371)(334)(7)(712)
Other operating expenses (3)(295)(113)(47)(455)
Underwriting income (loss)$108 $393 $201 702 
Net investment income451 
Net realized gains (losses)(99)
Equity in net income of investments accounted for using the equity method224 
Other income (loss)4 
Corporate expenses (4)(5)
Transaction costs and other (4)(17)
Amortization of intangible assets(30)
Interest expense(62)
Net foreign exchange gains (losses)18 
Income (loss) before income taxes and income (loss) from operating affiliates1,186 
Income tax (expense) benefit(184)
Income (loss) from operating affiliates33 
Net income (loss) available to Arch1,035 
Preferred dividends(10)
Net income (loss) available to Arch common shareholders$1,025 
Underwriting Ratios
Loss ratio60.8 %55.9 %6.9 %55.0 %
Acquisition expense ratio19.2 %18.5 %2.4 %17.7 %
Other operating expense ratio (5)14.4 %3.9 %16.2 %9.8 %
Combined ratio94.4 %78.3 %25.5 %82.5 %
Goodwill and intangible assets$725 $89 $319 $1,133 
(1)    Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations.
(2)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(3)    ‘Other operating expenses’ primarily include expenses that are related to compensation and employee benefits, information technology and professional fees.
(4)    Certain expenses have been excluded from ‘Corporate expenses’ and reflected in ‘Transaction costs and other.’
(5)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’

ARCH CAPITAL
 15
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Three Months Ended
September 30, 2025
InsuranceReinsuranceMortgageTotal
Gross premiums written (1)$2,567 $2,515 $330 $5,410 
Premiums ceded (1)(614)(778)(56)(1,446)
Net premiums written1,953 1,737 274 3,964 
Change in unearned premiums16 278 27 321 
Net premiums earned1,969 2,015 301 4,285 
Other underwriting income (2)9 38 3 50 
Losses and loss adjustment expenses(1,162)(1,040)2 (2,200)
Acquisition expenses(386)(398)(2)(786)
Other operating expenses (3)(301)(133)(44)(478)
Underwriting income (loss)$129 $482 $260 871 
Net investment income408 
Net realized gains (losses)210 
Equity in net income of investments accounted for using the equity method134 
Other income (loss)22 
Corporate expenses (4)(28)
Transaction costs and other (4)(21)
Amortization of intangible assets(49)
Interest expense(37)
Net foreign exchange gains (losses)(7)
Income (loss) before income taxes and income (loss) from operating affiliates1,503 
Income tax (expense) benefit(215)
Income (loss) from operating affiliates62 
Net income (loss) available to Arch1,350 
Preferred dividends(10)
Net income (loss) available to Arch common shareholders$1,340 
Underwriting Ratios
Loss ratio59.0 %51.6 %(0.5)%51.4 %
Acquisition expense ratio19.6 %19.8 %0.7 %18.4 %
Other operating expense ratio (5)14.8 %4.7 %13.3 %10.0 %
Combined ratio93.4 %76.1 %13.5 %79.8 %
Goodwill and intangible assets$833 $100 $335 $1,268 

(1)    Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations.
(2)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(3)    ‘Other operating expenses’ primarily include expenses that are related to compensation and employee benefits, information technology and professional fees.
(4)    Certain expenses have been excluded from ‘Corporate expenses’ and reflected in ‘Transaction costs and other.’
(5)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’

ARCH CAPITAL
 16
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Nine Months Ended
September 30, 2026
InsuranceReinsuranceMortgageTotal
Gross premiums written (1)$8,066 $8,929 $956 $17,942 
Premiums ceded (1)(2,221)(3,333)(155)(5,700)
Net premiums written5,845 5,596 801 12,242 
Change in unearned premiums(157)(138)38 (257)
Net premiums earned5,688 5,458 839 11,985 
Other underwriting income (2)41 117 19 177 
Losses and loss adjustment expenses(3,489)(2,950)(52)(6,491)
Acquisition expenses(1,121)(1,022)(17)(2,160)
Other operating expenses (3)(918)(359)(147)(1,424)
Underwriting income (loss)$201 $1,244 $642 2,087 
Net investment income1,276 
Net realized gains (losses)(203)
Equity in net income of investments accounted for using the equity method580 
Other income (loss)29 
Corporate expenses (4)(48)
Transaction costs and other (4)(67)
Amortization of intangible assets(90)
Interest expense(143)
Net foreign exchange gains (losses)49 
Income (loss) before income taxes and income (loss) from operating affiliates3,470 
Income tax (expense) benefit(446)
Income (loss) from operating affiliates115 
Net income (loss) available to Arch3,139 
Preferred dividends(30)
Net income (loss) available to Arch common shareholders$3,109 
Underwriting Ratios
Loss ratio61.3 %54.1 %6.2 %54.2 %
Acquisition expense ratio19.7 %18.7 %2.0 %18.0 %
Other operating expense ratio (5)15.4 %4.4 %15.2 %10.4 %
Combined ratio96.4 %77.2 %23.4 %82.6 %

(1)    Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations.
(2)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(3)    ‘Other operating expenses’ primarily include expenses that are related to compensation and employee benefits, information technology and professional fees.
(4)    Certain expenses have been excluded from ‘Corporate expenses’ and reflected in ‘Transaction costs and other.’
(5)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’

ARCH CAPITAL
 17
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Nine Months Ended
September 30, 2025
InsuranceReinsuranceMortgageTotal
Gross premiums written (1)$7,893 $9,205 $979 $18,069 
Premiums ceded (1)(1,971)(3,093)(186)(5,242)
Net premiums written5,922 6,112 793 12,827 
Change in unearned premiums(124)18 89 (17)
Net premiums earned5,798 6,130 882 12,810 
Other underwriting income (2)25 123 17 165 
Losses and loss adjustment expenses(3,568)(3,524)2 (7,090)
Acquisition expenses(1,116)(1,251)(7)(2,374)
Other operating expenses (3)(883)(378)(144)(1,405)
Underwriting income (loss)$256 $1,100 $750 2,106 
Net investment income1,191 
Net realized gains (losses)442 
Equity in net income of investments accounted for using the equity method349 
Other income (loss)38 
Corporate expenses (4)(107)
Transaction costs and other (4)(49)
Amortization of intangible assets(146)
Interest expense(110)
Net foreign exchange gains (losses)(122)
Income (loss) before income taxes and income (loss) from operating affiliates3,592 
Income tax (expense) benefit(550)
Income (loss) from operating affiliates119 
Net income (loss) available to Arch3,161 
Preferred dividends(30)
Net income (loss) available to Arch common shareholders$3,131 
Underwriting Ratios
Loss ratio61.5 %57.5 %(0.2)%55.4 %
Acquisition expense ratio19.3 %20.4 %0.8 %18.5 %
Other operating expense ratio (5)14.8 %4.2 %14.3 %9.7 %
Combined ratio95.6 %82.1 %14.9 %83.6 %

(1)    Certain assumed and ceded amounts related to intersegment transactions are included in individual segment results. Accordingly, the sum of such transactions for each segment does not agree to the total due to eliminations.
(2)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(3)    ‘Other operating expenses’ primarily include expenses that are related to compensation and employee benefits, information technology and professional fees.
(4)    Certain expenses have been excluded from ‘Corporate expenses’ and reflected in ‘Transaction costs and other.’
(5)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’

ARCH CAPITAL
 18
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
6.    Reserve for Losses and Loss Adjustment Expenses
The following table represents an analysis of losses and loss adjustment expenses and a reconciliation of the beginning and ending reserve for losses and loss adjustment expenses:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Reserve for losses and loss adjustment expenses at beginning of period
$34,775 $32,089 $33,547 $29,369 
Unpaid losses and loss adjustment expenses recoverable
9,311 8,513 9,054 7,821 
Net reserve for losses and loss adjustment expenses at beginning of period
25,464 23,576 24,493 21,548 
Net incurred losses and loss adjustment expenses relating to losses occurring in:
Current year
2,395 2,321 7,069 7,561 
Prior years
(189)(121)(578)(471)
Total net incurred losses and loss adjustment expenses
2,206 2,200 6,491 7,090 
Net losses and loss adjustment expense reserves of acquired businesses (1) — — — 50 
Net foreign exchange (gains) losses and other
(20)(52)(88)541 
Net paid losses and loss adjustment expenses relating to losses occurring in:
Current year
(853)(422)(1,182)(1,287)
Prior years
(912)(1,147)(3,829)(3,787)
Total net paid losses and loss adjustment expenses
(1,765)(1,569)(5,011)(5,074)
Net reserve for losses and loss adjustment expenses at end of period
25,885 24,155 25,885 24,155 
Unpaid losses and loss adjustment expenses recoverable
9,620 8,667 9,620 8,667 
Reserve for losses and loss adjustment expenses at end of period
$35,505 $32,822 $35,505 $32,822 
(1) Activity in the 2025 periods related to the MCE Acquisition (see note 2).
Prior year development (“PYD”) arises from changes in loss estimates during the current period related to events occurring in prior calendar years. Long-tailed lines include lines of business that typically take many years for claims to settle, such as third-party liability, while short-tailed lines are those that settle more quickly, such as property. The table below summarizes (favorable) and adverse net PYD by segment and tail length:
Three Months EndedNine Months Ended
(Favorable) AdverseSeptember 30,September 30,
2026Short-tailedLong-tailedTotalShort-tailedLong-tailedTotal
Insurance$(53)$39 $(14)$(96)$41 $(55)
Reinsurance(149)16 (133)(444)62 (382)
Mortgage(42)— (42)(141)— (141)
Total$(244)$55 $(189)$(681)$103 $(578)
2025
Insurance$(27)$13 $(14)$(55)$16 $(39)
Reinsurance(75)22 (53)(277)24 (253)
Mortgage(54)— (54)(179)— (179)
Total$(156)$35 $(121)$(511)$40 $(471)

ARCH CAPITAL
 19
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
2026 Third Quarter
The insurance segment’s short-tailed lines included $33 million of favorable development in property, energy, marine and aviation business, primarily from the 2024 and 2025 accident years (i.e., the year in which a loss occurred). Long-tailed lines included $14 million of adverse development in retail energy business (third party occurrence), primarily from the 2022 to 2025 accident years and $8 million in program business, mainly from the 2019 and 2023 accident years.
The reinsurance segment’s short-tailed lines included $69 million of favorable development from property other than property catastrophe business, primarily from the 2023 to 2025 underwriting years (i.e., all premiums and losses attributable to contracts having an inception or renewal date within the given 12 month period), $35 million of favorable development from property catastrophe business, primarily from the 2024 and 2025 underwriting years, and $28 million of favorable development in specialty, primarily from the 2023 and 2024 underwriting years. Long-tailed lines included $16 million of adverse development in casualty, primarily from the 2021 and 2024 underwriting years.
The mortgage segment’s favorable development was driven by reductions on reserves for delinquent loans associated with the U.S. first lien portfolio primarily from the 2025 accident year, with the credit risk transfer and international businesses also contributing.
2025 Third Quarter
The insurance segment’s short-tailed lines included $11 million of favorable development in property, energy, marine and aviation, primarily from the 2023 and 2024 accident years, and $8 million of favorable development in travel and accident, primarily from the 2024 accident year. Long-tailed lines primarily included adverse development in programs business, mainly from the 2021 to 2023 accident years.
The reinsurance segment’s short-tailed lines included $28 million of favorable development from property other than property catastrophe business, primarily from the 2023 and 2024 underwriting years, and $28 million of favorable development from property catastrophe business, primarily from the 2021 to 2024 underwriting years. Long-tailed lines included $22 million of adverse development in casualty, primarily from the 2021 and 2024 underwriting years.
The mortgage segment’s favorable development was driven by reductions on reserves for delinquent loans associated with the U.S. first lien portfolio primarily from the 2024 accident year, with the credit risk transfer and international businesses also contributing.
Nine Months Ended September 30, 2026
The insurance segment’s short-tailed lines included $62 million of favorable development in property, energy, marine and aviation business, primarily from the 2024 accident year, and $23 million of favorable development in travel and accident, primarily from the 2025 accident year. Long-tailed lines included $22 million of adverse development in retail energy business, primarily from the 2022 to 2025 accident years and $20 million of adverse development in program business, mainly from the 2019 to 2023 accident years.
The reinsurance segment’s short-tailed lines included $202 million of favorable development from property other than property catastrophe business, primarily from the 2023 to 2025 underwriting years, and $114 million of favorable development from property catastrophe, primarily from the 2023 to 2025 underwriting years. Long-tailed lines included $63 million of adverse development in casualty, primarily from the 2021 to 2024 underwriting years.
The mortgage segment’s favorable development was driven by reserve releases associated with the U.S. first lien portfolio from the 2024 and 2025 accident years, with the Company’s credit risk transfer and international businesses also contributing.
Nine Months Ended September 30, 2025
The insurance segment’s short-tailed lines included $23 million of favorable development in travel and accident, primarily from the 2023 and 2024 accident years, and $21 million of favorable development in property, energy, marine and aviation, primarily from the 2023 and 2024 accident years. Long-tailed lines primarily included adverse development in programs business, mainly from the 2020 to 2024 accident years.
The reinsurance segment’s short-tailed lines included $117 million of favorable development from property other than property catastrophe, primarily from the 2023 and 2024 underwriting years, and $114 million of favorable development from property catastrophe, primarily from the 2023 and 2024 underwriting years. Long-tailed lines included $24 million of adverse development in casualty, primarily from the 2021 and 2024 underwriting years.
The mortgage segment’s favorable development was driven by reserve releases associated with the U.S. first lien portfolio primarily from the 2023 and 2024 accident years. The Company’s credit risk transfer and international businesses also contributed to the favorable development.
ARCH CAPITAL
 20
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
7.    Allowance for Expected Credit Losses
Premiums Receivable
The following table provides a roll forward of the allowance for expected credit losses of the Company’s premium receivables:
Premium Receivables, Net of AllowanceAllowance for Expected Credit Losses
Three Months Ended September 30, 2026
Balance at beginning of period$7,160 $41 
Change for provision of expected credit losses (1) — 
Balance at end of period$6,919 $41 
Three Months Ended September 30, 2025
Balance at beginning of period$7,067 $46 
Change for provision of expected credit losses (1) 8 
Balance at end of period$6,450 $54 
Nine Months Ended September 30, 2026
Balance at beginning of year$5,723 $43 
Change for provision of expected credit losses (1) (2)
Balance at end of period$6,919 $41 
Nine Months Ended September 30, 2025
Balance at beginning of year$5,634 $45 
Change for provision of expected credit losses (1)
9 
Balance at end of period$6,450 $54 

(1)    Amounts deemed uncollectible are written-off in operating expenses. For the 2026 third quarter and 2025 third quarter, amounts written off were nil for both periods. For the nine months ended September 30, 2026 and 2025 period, amounts written off were nil and $1 million, respectively.
Reinsurance Recoverables
The following table provides a roll forward of the allowance for expected credit losses of the Company’s reinsurance recoverables:
Reinsurance Recoverables, Net of AllowanceAllowance for Expected Credit Losses
Three Months Ended September 30, 2026
Balance at beginning of period$9,964 $18 
Change for provision of expected credit losses1 
Balance at end of period$10,253 $19 
Three Months Ended September 30, 2025
Balance at beginning of period$9,044 $19 
Change for provision of expected credit losses— 
Balance at end of period$9,070 $19 
Nine Months Ended September 30, 2026
Balance at beginning of year$9,526 $17 
Change for provision of expected credit losses2 
Balance at end of period$10,253 $19 
Nine Months Ended September 30, 2025
Balance at beginning of year$8,260 $17 
Change for provision of expected credit losses2 
Balance at end of period$9,070 $19 
The following table summarizes the Company’s reinsurance recoverables on paid and unpaid losses (not including ceded unearned premiums):
September 30,
December 31,
20262025
Reinsurance recoverable on unpaid and paid losses and loss adjustment expenses$10,253$9,526
% due from carriers with A.M. Best rating of “A-” or better62.3 %62.1 %
% due from all other carriers with no A.M. Best rating (1)37.7 %37.9 %
Largest balance due from any one carrier as % of total shareholders’ equity9.0 %8.1 %
(1)    At September 30, 2026 and December 31, 2025 over 95% of such amount were collateralized through reinsurance trusts, funds withheld arrangements, letters of credit or other.

ARCH CAPITAL
 21
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Contractholder Receivables
The following table provides a roll forward of the allowance for expected credit losses of the Company’s contractholder receivables:
Contract-holder Receivables, Net of AllowanceAllowance for Expected Credit Losses
Three Months Ended September 30, 2026
Balance at beginning of period$2,264 $7 
Change for provision of expected credit losses— 
Balance at end of period$2,357 $7 
Three Months Ended September 30, 2025
Balance at beginning of period$2,280 $6 
Change for provision of expected credit losses— 
Balance at end of period$2,287 $6 
Nine Months Ended September 30, 2026
Balance at beginning of year$2,270 $7 
Change for provision of expected credit losses— 
Balance at end of period$2,357 $7 
Nine Months Ended September 30, 2025
Balance at beginning of year$2,161 $5 
Change for provision of expected credit losses1 
Balance at end of period$2,287 $6 

ARCH CAPITAL
 22
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
8.    Investment Information

Available For Sale Investments
The following table summarizes the fair value and cost or amortized cost of the Company’s securities classified as available for sale:
Estimated
Fair
Value		Gross
Unrealized
Gains		Gross
Unrealized
Losses		Allowance for Expected Credit Losses Cost or
Amortized
Cost
September 30, 2026
Fixed maturities:
Corporate bonds$14,288 $51 $(570)$(13)$14,820 
U.S. government and government agencies7,230 4 (192)— 7,418 
Asset backed securities3,735 3 (69)(5)3,806 
Non-U.S. government securities2,748 19 (125)(1)2,855 
Residential mortgage backed securities2,518 1 (107)— 2,624 
Commercial mortgage backed securities1,505 1 (21)— 1,525 
Municipal bonds95 — (5)— 100 
Total32,119 79 (1,089)(19)33,148 
Short-term investments3,253 1 (4)— 3,256 
Total$35,372 $80 $(1,093)$(19)$36,404 
December 31, 2025
Fixed maturities:
Corporate bonds$14,058 $265 $(142)$(10)$13,945 
U.S. government and government agencies7,445 23 (21)— 7,443 
Asset backed securities3,574 20 (15)(8)3,577 
Non-U.S. government securities3,270 53 (81)(1)3,299 
Residential mortgage backed securities2,705 34 (21)— 2,692 
Commercial mortgage backed securities1,212 11 (5)(1)1,207 
Municipal bonds162 — (4)— 166 
Total32,426 406 (289)(20)32,329 
Short-term investments2,625 2 (1)— 2,624 
Total$35,051 $408 $(290)$(20)$34,953 

ARCH CAPITAL
 23
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table summarizes, for all available for sale securities in an unrealized loss position, the fair value and gross unrealized loss by length of time the security has been in a continual unrealized loss position:
Less than 12 Months12 Months or MoreTotal
Estimated
Fair
Value		Gross
Unrealized
Losses		Estimated
Fair
Value		Gross
Unrealized
Losses		Estimated
Fair
Value		Gross
Unrealized
Losses
September 30, 2026
Fixed maturities:
Corporate bonds$12,717 $(474)$1,017 $(96)$13,734 $(570)
U.S. government and government agencies7,061 (185)89 (7)7,150 (192)
Asset backed securities2,381 (52)270 (17)2,651 (69)
Residential mortgage backed securities2,284 (81)172 (26)2,456 (107)
Non-U.S. government securities2,242 (68)450 (57)2,692 (125)
Commercial mortgage backed securities827 (16)37 (5)864 (21)
Municipal bonds2 — 93 (5)95 (5)
Total27,514 (876)2,128 (213)29,642 (1,089)
Short-term investments1,440 (4)— — 1,440 (4)
Total$28,954 $(880)$2,128 $(213)$31,082 $(1,093)
December 31, 2025
Fixed maturities:
Corporate bonds$2,972 $(64)$1,364 $(78)$4,336 $(142)
U.S. government and government agencies3,092 (15)274 (6)3,366 (21)
Asset backed securities806 (2)332 (13)1,138 (15)
Residential mortgage backed securities312 (3)178 (18)490 (21)
Non-U.S. government securities2,087 (35)432 (46)2,519 (81)
Commercial mortgage backed securities239 (1)48 (4)287 (5)
Municipal bonds6 — 137 (4)143 (4)
Total9,514 (120)2,765 (169)12,279 (289)
Short-term investments614 (1)— — 614 (1)
Total$10,128 $(121)$2,765 $(169)$12,893 $(290)
At September 30, 2026, on a lot level basis, approximately 18,100 security lots out of a total of approximately 24,250 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $7 million. At December 31, 2025, on a lot level basis, approximately 7,240 security lots out of a total of approximately 25,330 security lots were in an unrealized loss position and the largest single unrealized loss from a single lot in the Company’s fixed maturity portfolio was $4 million.
The contractual maturities of the Company’s fixed maturities are shown in the following table. Expected maturities, which are management’s best estimates, will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
September 30, 2026December 31, 2025
MaturityEstimated
Fair
Value		Amortized
Cost		Estimated
Fair
Value		Amortized
Cost
Due in one year or less$937 $941 $370 $366 
Due after one year through five years15,666 16,063 17,053 16,989 
Due after five years through 10 years7,166 7,551 6,893 6,877 
Due after 10 years592 638 619 621 
24,361 25,193 24,935 24,853 
Residential mortgage backed securities2,518 2,624 2,705 2,692 
Commercial mortgage backed securities1,505 1,525 1,212 1,207 
Asset backed securities3,735 3,806 3,574 3,577 
Total$32,119 $33,148 $32,426 $32,329 

ARCH CAPITAL
 24
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Equity Securities, at Fair Value
At September 30, 2026, the Company held $2.4 billion of equity securities, at fair value, compared to $1.9 billion at December 31, 2025. Such holdings include publicly traded common stocks, primarily in the consumer cyclical and non-cyclical, technology, communication and financial sectors, and exchange-traded funds in fixed income, equity and other sectors.
Other Investments, at Fair Value
The following table summarizes the Company’s other investments:
September 30,
2026		December 31,
2025
Other investments$2,136 $1,957 
Fixed maturities 1,164 1,110 
Short term investments60 64 
Equity securities4 5 
Total$3,364 $3,136 
The following table summarizes the Company’s other investments, as detailed in the previous table, by strategy:
September 30,
2026		December 31,
2025
Investment grade fixed income$1,313 $1,225 
Private equity258 250 
Lending276 220 
Term loan investments184 173 
Credit related funds90 87 
Equities13 — 
Energy2 2 
Total$2,136 $1,957 
Net Investment Income
The components of net investment income were derived from the following sources:
September 30,
20262025
Three Months Ended
Fixed maturities$409 $379 
Short term investments27 25 
Equity securities (dividends)10 10 
Other (1)30 19 
Gross investment income476 433 
Investment expenses(25)(25)
Net investment income$451 $408 
Nine Months Ended
Fixed maturities$1,179 $1,081 
Short term investments77 75 
Equity securities (dividends)27 31 
Other (1)72 82 
Gross investment income1,355 1,269 
Investment expenses(79)(78)
Net investment income$1,276 $1,191 
(1)    Amounts include dividends and other distributions on investment funds, term loan investments, funds held balances, cash balances and other items.

ARCH CAPITAL
 25
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Net Realized Gains (Losses)
Net realized gains (losses), which include changes in the allowance for credit losses on financial assets and net impairment losses recognized in earnings were as follows:
September 30,
20262025
Three Months Ended
Available for sale securities:
Gross gains on investment sales$22 $103 
Gross losses on investment sales(102)(59)
Change in fair value of assets and liabilities accounted for using the fair value option:
Fixed maturities(38)11 
Other investments— 29 
Equity securities, at fair value:
Net realized gains (losses) on sales during the period10 15 
Net unrealized gains (losses) on equity securities still held at reporting date83 79 
Allowance for credit losses:
Investments related(4)4 
Underwriting related(1)(9)
Derivative instruments (1)(54)30 
Other(15)7 
Net realized gains (losses)$(99)$210 
Nine Months Ended
Available for sale securities:
Gross gains on investment sales$137 $223 
Gross losses on investment sales(248)(228)
Change in fair value of assets and liabilities accounted for using the fair value option:
Fixed maturities(56)33 
Other investments14 31 
Short-term investments— 3 
Equity securities, at fair value:
Net realized gains (losses) on sales during the period54 69 
Net unrealized gains (losses) on equity securities still held at reporting date199 113 
Allowance for credit losses:
Investments related(3)(4)
Underwriting related2 (10)
Derivative instruments (1)(148)292 
Other (2)(154)(80)
Net realized gains (losses)$(203)$442 
(1) See note 10 for information on the Company’s derivative instruments.
(2) Amounts in the 2026 periods primarily reflect a litigation-related loss contingency recorded pursuant to ASC 450, while amounts recorded in the 2025 periods primarily relate to losses arising from the sale of certain alternative investments accounted for under the equity method.
Investments Accounted For Using the Equity Method
The following table summarizes the Company’s investments accounted for using the equity method, by strategy:
September 30,
2026		December 31,
2025
Private equity$2,602 $2,397 
Credit related funds1,696 1,616 
Real estate872 767 
Lending692 558 
Fixed income491 501 
Infrastructure328 346 
Equities398 231 
Energy47 37 
Total$7,126 $6,453 
Certain of the Company’s other investments are in investment funds for which the Company has the option to redeem at agreed upon values as described in each investment fund’s subscription agreement. Depending on the terms of the various subscription agreements, investments in investment funds may be redeemed daily, monthly, quarterly or on other terms. Two common redemption restrictions that may impact the Company’s ability to redeem these investment funds are gates and lockups. A gate is a suspension of redemptions that may be implemented by the general partner or investment manager of the fund in order to defer, in whole or in part, the redemption request in the event the aggregate amount of redemption requests exceeds a predetermined percentage of the investment fund’s net assets and which may otherwise hinder the general partner or investment manager’s ability to liquidate holdings in an orderly fashion in order to generate the cash necessary to fund extraordinarily large redemption payouts. A lockup period is the initial amount of time an investor is contractually required to hold the security before having the ability to redeem. If the investment funds are eligible to be redeemed, the time to redeem such fund can take weeks or months following the notification.
Limited Partnership Interests
In the normal course of its activities, the Company invests in limited partnerships as part of its overall investment strategy. Such amounts are included in ‘investments accounted for using the equity method’ and ‘investments accounted for using the fair value option.’ The Company has determined that it is not required to consolidate these investments because it is not the primary beneficiary of the funds. The Company’s maximum exposure to loss with respect to these investments is limited to the investment carrying amounts reported in the Company’s consolidated balance sheet and any unfunded commitment.
ARCH CAPITAL
 26
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table summarizes investments in limited partnership interests where the Company has a variable interest by balance sheet line item:
September 30,
2026		December 31,
2025
Investments accounted for using the equity method (1)$7,126 $6,453 
Investments accounted for using the fair value option (2)15 — 
Total$7,141 $6,453 
(1)    Aggregate unfunded commitments were $4.0 billion at September 30, 2026, compared to $3.6 billion at December 31, 2025.
(2)    Aggregate unfunded commitments were $545 million at September 30, 2026, compared to $65 million at December 31, 2025.
Equity in Net Income (Loss) of Investments Accounted for Using the Equity Method
Income from investment funds accounted for using the equity method for the 2026 third quarter was $224 million, compared to $134 million for the 2025 third quarter and an income of $580 million for the nine months ended September 30, 2026, compared to income of $349 million for the nine months ended September 30, 2025. In applying the equity method, investments are initially recorded at cost and are subsequently adjusted based on the Company’s proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). Such investments are generally recorded on a one to three month lag based on the availability of reports from the investment funds.
Investments in Operating Affiliates
Investments in which the Company has significant influence over the operating and financial policies are classified as ‘investments in operating affiliates’ on the Company’s balance sheets and are accounted for under the equity method. Such investments primarily include the Company’s investment in Coface SA (“Coface”), Greysbridge Holdings Ltd. (“Greysbridge”), and Premia Holdings Ltd. Investments in Coface and Premia Holdings Ltd. are generally recorded on a three month lag, while the Company’s investment in Greysbridge is not recorded on a lag.
As of September 30, 2026, the Company owned approximately 29.9% of the issued shares of Coface, or 30% excluding treasury shares, with a carrying value of $697 million, compared to $707 million at December 31, 2025.
As of September 30, 2026, the Company owned 31.75% of Greysbridge with a carrying value of $549 million, compared to a 30% ownership interest with a carrying value of $486 million at December 31, 2025. The increase in share ownership is a result of the settlement of certain put options during the second quarter of 2026.
Income from operating affiliates for the 2026 third quarter was $33 million, compared to $62 million for the 2025 third quarter and income of $115 million for the nine months ended September 30, 2026, compared to income of $119 million for nine months ended September 30, 2025.
See note 16 for information on Company’s transactions with related parties.

ARCH CAPITAL
 27
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Allowance for Expected Credit Losses
The following table provides a roll forward of the allowance for expected credit losses of the Company’s securities classified as available for sale:
Structured Securities (1)Corporate
Bonds		Non-U.S.
Government
Securities		Total
Three Months Ended September 30, 2026
Balance at beginning of period$9 $6 $1 $16 
Additions for current-period provision for expected credit losses— 8 — 8 
Additions (reductions) for previously recognized expected credit losses (4)(1)— (5)
Reductions due to disposals— — — — 
Balance at end of period$5 $13 $1 $19 
Three Months Ended September 30, 2025
Balance at beginning of period$10 $16 $2 $28 
Additions for current-period provision for expected credit losses— — — — 
Additions (reductions) for previously recognized expected credit losses (4)— (1)(5)
Reductions due to disposals— (2)— (2)
Balance at end of period$6 $14 $1 $21 
Nine Months Ended September 30, 2026
Balance at beginning of year$9 $10 $1 $20 
Additions for current-period provision for expected credit losses1 9 — 10 
Additions (reductions) for previously recognized expected credit losses(5)(3)— (8)
Reductions due to disposals— (3)— (3)
Balance at end of period$5 $13 $1 $19 
Nine Months Ended September 30, 2025
Balance at beginning of year$9 $12 $1 $22 
Additions for current-period provision for expected credit losses3 2 — 5 
Additions (reductions) for previously recognized expected credit losses(6)5 — (1)
Reductions due to disposals— (5)— (5)
Balance at end of period$6 $14 $1 $21 
(1)    Includes asset backed securities, residential mortgage backed securities and commercial mortgage backed securities.
Restricted Assets
The Company is required to maintain assets on deposit, which primarily consist of fixed maturities, with various regulatory authorities to support its underwriting operations. The Company’s subsidiaries maintain assets in trust accounts as collateral for transactions with affiliated companies and also have investments in segregated portfolios primarily to provide collateral or guarantees for letters of credit to third parties. See note 18, “Commitments and Contingencies,” of the notes to consolidated financial statements in the Company’s 2025 Form 10-K.
The following table details the value of the Company’s restricted assets:
September 30,
2026		December 31,
2025
Assets used for collateral or guarantees:
Affiliated transactions$5,368 $5,323 
Third party agreements6,384 6,784 
Deposits with U.S. regulatory authorities913 948 
Other (1)1,645 1,898 
Total restricted assets$14,310 $14,953 
(1)    Primarily includes Funds at Lloyds, deposits with non-U.S. regulatory authorities and other restricted assets.
ARCH CAPITAL
 28
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Reconciliation of Cash and Restricted Cash
The following table details reconciliation of cash and restricted cash within the Consolidated Balance Sheets:
September 30,
2026		December 31,
2025
Cash$1,152 $993 
Restricted cash (included in ‘other assets’)825 1,074 
Cash and restricted cash$1,977 $2,067 
9.    Fair Value
Accounting guidance regarding fair value measurements addresses how companies should measure fair value when they are required to use a fair value measure for recognition or disclosure purposes under GAAP and provides a common definition of fair value to be used throughout GAAP. It defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly fashion between market participants at the measurement date. In addition, it establishes a three-level valuation hierarchy for the disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The level in the hierarchy within which a given fair value measurement falls is determined based on the lowest level input that is significant to the measurement (Level 1 being the highest priority and Level 3 being the lowest priority).
The levels in the hierarchy are defined as follows:
Level 1:
Inputs to the valuation methodology are observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets
Level 2:
Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument
Level 3:
Inputs to the valuation methodology are unobservable and significant to the fair value measurement
The following is a description of the valuation methodologies used for securities measured at fair value, as well as the general classification of such securities pursuant to the valuation hierarchy. The Company reviews its securities measured at fair value and discusses the proper classification of such investments with investment advisers and others.
The Company determines the existence of an active market based on its judgment as to whether transactions for the financial instrument occur in such market with sufficient frequency and volume to provide reliable pricing information. The independent pricing sources obtain market quotations and actual transaction prices for securities that have quoted prices in active markets. The Company uses quoted values and other data provided by nationally recognized independent pricing sources as inputs into its process for determining fair values of its fixed maturity investments. To validate the techniques or models used by pricing sources, the Company's review process includes, but is not limited to: (i) quantitative analysis (e.g., comparing the quarterly return for each managed portfolio to its target benchmark, with significant differences identified and investigated); (ii) a review of the average number of prices obtained in the pricing process and the range of resulting fair values; (iii) initial and ongoing evaluation of methodologies used by outside parties to calculate fair value; (iv) a comparison of the fair value estimates to the Company’s knowledge of the current market; (v) a comparison of the pricing services' fair values to other pricing services' fair values for the same investments; and (vi) periodic back-testing, which includes randomly selecting purchased or sold securities and comparing the executed prices to the fair value estimates from the pricing service. A price source hierarchy was maintained in order to determine which price source would be used (i.e., a price obtained from a pricing service with more seniority in the hierarchy will be used over a less senior one in all cases). The hierarchy prioritizes pricing services based on availability and reliability and assigns the highest priority to index providers. Based on the above review, the Company will challenge any prices for a security or portfolio which are considered not to be representative of fair value. The Company did not adjust any of the prices obtained from the independent pricing sources at September 30, 2026.
In certain circumstances, when fair values are unavailable from these independent pricing sources, quotes are obtained directly from broker-dealers who are active in the corresponding markets. Such quotes are subject to the validation procedures noted above. Where quotes are unavailable, fair value is determined by the investment manager using quantitative and qualitative assessments such as internally modeled values. Of the $41.7 billion of financial assets and liabilities measured at fair value at September 30, 2026, approximately $428 million, or 1.0%, were priced using non-binding broker-dealer quotes or modeled valuations. Of the $40.3 billion of financial assets and liabilities measured at fair value at December 31, 2025, approximately $278 million, or 0.7%, were priced using non-binding broker-dealer quotes or modeled valuations.
ARCH CAPITAL
 29
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Fixed maturities
The Company uses the market approach valuation technique to estimate the fair value of its fixed maturity securities, when possible. The market approach includes obtaining prices from independent pricing services, such as index providers and pricing vendors, as well as to a lesser extent quotes from broker-dealers. The independent pricing sources obtain market quotations and actual transaction prices for securities that have quoted prices in active markets. Each source has its own proprietary method for determining the fair value of securities that are not actively traded. In general, these methods involve the use of “matrix pricing” in which the independent pricing source uses observable market inputs including, but not limited to, investment yields, credit risks and spreads, benchmarking of like securities, broker-dealer quotes, reported trades and sector groupings to determine a reasonable fair value.
The following describes the significant inputs generally used to determine the fair value of the Company’s fixed maturity securities by asset class:
U.S. government and government agencies – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The Company determined that all U.S. Treasuries would be classified as Level 1 securities due to observed levels of trading activity, the high number of strongly correlated pricing quotes received on U.S. Treasuries and other factors. The fair values of U.S. government agency securities are generally determined using the spread above the risk-free yield curve. As the yields for the risk-free yield curve and the spreads for these securities are observable market inputs, the fair values of U.S. government agency securities are classified within Level 2.
Corporate bonds – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined using the spread above the risk-free yield curve. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. As the significant inputs used in the pricing process for corporate bonds are observable market inputs, the fair value of these securities are classified within Level 2. A small number of securities are included in Level 3 due to a low level of transparency on the inputs used in the pricing process.
Municipal bonds – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The fair values of these securities are generally determined using spreads obtained from broker-dealers who trade in the relevant security market, trade prices and the new issue market. As the
significant inputs used in the pricing process for municipal bonds are observable market inputs, the fair value of these securities are classified within Level 2.
Residential mortgage-backed securities – valuations provided by independent pricing services, substantially all through pricing vendors and index providers with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models (including Option Adjusted Spread) which use spreads to determine the expected average life of the securities. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. The pricing services also review prepayment speeds and other indicators, when applicable. As the significant inputs used in the pricing process for mortgage-backed securities are observable market inputs, the fair value of these securities are classified within Level 2. A small number of securities are included in Level 3 due to a low level of transparency on the inputs used in the pricing process.
Commercial mortgage-backed securities – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models which use spreads to determine the appropriate average life of the securities. These spreads are generally obtained from the new issue market, secondary trading and from broker-dealers who trade in the relevant security market. The pricing services also review prepayment speeds and other indicators, when applicable. As the significant inputs used in the pricing process for commercial mortgage-backed securities are observable market inputs, the fair value of these securities are classified within Level 2.
Non-U.S. government securities – valuations provided by independent pricing services, with all prices provided through index providers and pricing vendors. The fair values of these securities are generally based on international indices or valuation models which include daily observed yield curves, cross-currency basis index spreads and country credit spreads. As the significant inputs used in the pricing process for non-U.S. government securities are observable market inputs, the fair value of these securities are classified within Level 2.
Asset-backed securities – valuations provided by independent pricing services, substantially all through index providers and pricing vendors with a small amount through broker-dealers. The fair values of these securities are generally determined through the use of pricing models (including Option Adjusted Spread) which use spreads to determine the appropriate average life of the securities. These spreads are generally obtained from the new issue
ARCH CAPITAL
 30
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
market, secondary trading and from broker-dealers who trade in the relevant security market. The pricing services also review prepayment speeds and other indicators, when applicable. As the significant inputs used in the pricing process for asset-backed securities are observable market inputs, the fair value of these securities are classified within Level 2.
Equity securities
The Company determined that exchange-traded equity securities would be included in Level 1 as their fair values are based on quoted market prices in active markets. Certain equity securities are included in Level 2 of the valuation hierarchy as the significant inputs used in the pricing process for such securities are observable market inputs. Other equity securities are included in Level 3 due to the lack of an available independent price source for such securities. As the significant inputs used to price these securities are unobservable, the fair value of such securities are classified as Level 3.
Other investments
The Company’s other investments include term loan investments for which fair values are estimated by using quoted prices of term loan investments with similar characteristics, pricing models or matrix pricing. Such investments are generally classified within Level 2. The fair values for certain of the Company’s other investments are determined using net asset values as advised by external fund managers. The net asset value is based on the fund manager’s valuation of the underlying holdings in accordance with the fund’s governing documents. In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. A small number of securities are included in Level 3 due to the lack of an available independent price source for such securities.
Derivative instruments
The Company’s futures contracts, foreign currency forward contracts, interest rate swaps and other derivatives trade in the over-the-counter derivative market. The Company uses the market approach valuation technique to estimate the fair value for these derivatives based on significant observable market inputs from third party pricing vendors, non-binding broker-dealer quotes and/or recent trading activity. As the significant inputs used in the pricing process for these derivative instruments are observable market inputs, the fair value of these securities are classified within Level 2.

Short-term investments
The Company determined that certain of its short-term investments held in highly liquid money market-type funds, U.S. Treasury bills and commercial paper would be included in Level 1 as their fair values are based on quoted market prices in active markets. The fair values of certain short-term investments are generally determined using the spread above the risk-free yield curve and are classified within Level 2. Other short-term investments are included in Level 3 due to the lack of an available independent price source for such securities. As the significant inputs used to price these short-term securities are unobservable, the fair value of such securities are classified as Level 3.
Residential mortgage loans
The Company’s residential mortgage loans (included in ‘other assets’ in the consolidated balance sheets) include amounts related to the Company’s whole mortgage loan purchase and sell program. Fair values of residential mortgage loans are generally determined based on market prices. As significant inputs used in the pricing process for these residential mortgage loans are observable market inputs, the fair value of these securities are classified within Level 2.
Other liabilities
The Company’s other liabilities include contingent and deferred consideration liabilities related to the Company’s acquisitions. Contingent consideration liabilities are remeasured at fair value at each balance sheet date with changes in fair value recognized in ‘net realized gains (losses)’. To determine the fair value of contingent consideration liabilities, the Company estimates the future payments using an income approach based on modeled inputs which include a weighted average cost of capital. Deferred consideration liabilities are measured at fair value on the transaction date. The Company determined that contingent and deferred consideration liabilities would be included within Level 3.

ARCH CAPITAL
 31
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table presents the Company’s financial assets and liabilities measured at fair value by level at September 30, 2026:
Estimated Fair Value Measurements Using:
Estimated
Fair
Value		Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Assets measured at fair value:
Available for sale securities:
Fixed maturities:
Corporate bonds$14,288 $— $14,129 $159 
U.S. government and government agencies7,230 7,230 — — 
Asset backed securities3,735 — 3,655 80 
Non-U.S. government securities2,748 — 2,748 — 
Residential mortgage backed securities2,518 — 2,514 4 
Commercial mortgage backed securities1,505 — 1,505 — 
Municipal bonds95 — 95 — 
Total32,119 7,230 24,646 243 
Short-term investments3,253 2,987 266 — 
Equity securities, at fair value2,396 2,373 11 12 
Derivative instruments (2)284 — 284 — 
Residential mortgage loans47 — 47 — 
Fair value option:
Corporate bonds1,159 — 1,159 — 
Non-U.S. government securities1 — 1 — 
U.S. government and government agencies4 4 — — 
Short-term investments60 17 13 30 
Equity securities4 — — 4 
Other investments454 — 150 304 
Other investments measured at net asset value (1)1,682 
Total3,364 21 1,323 338 
Total assets measured at fair value$41,463 $12,611 $26,577 $593 
Liabilities measured at fair value:
Other liabilities$(12)$— $— $(12)
Derivative instruments (2)(192)— (192)— 
Total liabilities measured at fair value$(204)$— $(192)$(12)

(1)    In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.
(2)    See note 10.

ARCH CAPITAL
 32
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2025:
Estimated Fair Value Measurements Using:
Estimated
Fair
Value		Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)		Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Assets measured at fair value:
Available for sale securities:
Fixed maturities:
Corporate bonds$14,058 $— $13,930 $128 
U.S. government and government agencies7,445 7,445 — — 
Asset backed securities3,574 — 3,557 17 
Non-U.S. government securities3,270 — 3,270 — 
Residential mortgage backed securities2,705 — 2,705 — 
Commercial mortgage backed securities1,212 — 1,212 — 
Municipal bonds162 — 162 — 
Total32,426 7,445 24,836 145 
Short-term investments2,625 2,326 299 — 
Equity securities, at fair value1,864 1,829 26 9 
Derivative instruments (2)180 — 180 — 
Residential mortgage loans24 — 24 — 
Fair value option:
Corporate bonds1,102 — 1,102 — 
Non-U.S. government securities3 — 3 — 
Asset backed securities— — — — 
U.S. government and government agencies5 5 — — 
Short-term investments64 2 22 40 
Equity securities5 — — 5 
Other investments398 — 166 232 
Other investments measured at net asset value (1)1,559 
Total3,136 7 1,293 277 
Total assets measured at fair value$40,255 $11,607 $26,658 $431 
Liabilities measured at fair value:
Other liabilities$(18)$— $— $(18)
Derivative instruments (2)(72)— (72)— 
Total liabilities measured at fair value$(90)$— $(72)$(18)

(1)    In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.
(2)    See note 10.

ARCH CAPITAL
 33
2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table presents a reconciliation of the beginning and ending balances for all financial assets and liabilities measured at fair value on a recurring basis using Level 3 inputs:
AssetsLiabilities
sAvailable For SaleFair Value OptionFair Value
Structured Securities (1)Corporate
Bonds		Other
Investments		Short-term
Investments		Equity
Securities		Equity
Securities		Other Liabilities
Three Months Ended September 30, 2026
Balance at beginning of period$30 $114 $272 $44 $4 $10 $(14)
Total gains or (losses) (realized/unrealized)
Included in earnings (2)— — (1)— — — — 
Included in other comprehensive income— — — — — — — 
Purchases, issuances, sales and settlements
Purchases54 45 97 2 — 2 — 
Issuances— — — — — — — 
Sales— — (1)(11)— — — 
Settlements— (1)(66)(5)— — 2 
Transfers in and/or out of Level 3— 1 3 — — — — 
Balance at end of period$84 $159 $304 $30 $4 $12 $(12)
Three Months Ended September 30, 2025
Balance at beginning of period$17 $145 $208 $45 $5 $8 $(20)
Total gains or (losses) (realized/unrealized)
Included in earnings (2)— 1 — — — — — 
Included in other comprehensive income— 1 — — — — — 
Purchases, issuances, sales and settlements
Purchases— — 45 14 — 1 — 
Issuances— — — — — — — 
Sales — — (2)— — — — 
Settlements— (36)(33)(21)— — 2 
Transfers in and/or out of Level 3— — — — — — — 
Balance at end of period$17 $111 $218 $38 $5 $9 $(18)
Nine Months Ended September 30, 2026
Balance at beginning of year$17 $128 $232 $40 $5 $9 $(18)
Total gains or (losses) (realized/unrealized)
Included in earnings (2)— — (1)— (1)(1)1 
Included in other comprehensive income— (2)— — — — — 
Purchases, issuances, sales and settlements
Purchases63 46 187 48 — 4 — 
Issuances— — — — — — — 
Sales — — (4)(11)— — — 
Settlements(5)(43)(126)(48)— — 5 
Transfers in and/or out of Level 39 30 16 1 — — — 
Balance at end of period$84 $159 $304 $30 $4 $12 $(12)
Nine Months Ended September 30, 2025
Balance at beginning of year$— $97 $189 $33 $4 $7 $(73)
Total gains or (losses) (realized/unrealized)
Included in earnings (2)— 1 — — 1 — 2 
Included in other comprehensive income— 1 — — — — (2)
Purchases, issuances, sales and settlements
Purchases14 — 141 38 — 2 — 
Issuances— — — — — — — 
Sales— — (5)— — — — 
Settlements(2)(58)(107)(33)— — 55 
Transfers in and/or out of Level 35 70 — — — — — 
Balance at end of period$17 $111 $218 $38 $5 $9 $(18)
(1)     Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities.
(2)     Gains or losses were included in net realized gains (losses).
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2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Financial Instruments Disclosed, But Not Carried, At Fair Value
The Company uses various financial instruments in the normal course of its business. The carrying values of cash, accrued investment income, receivable for securities sold, certain other assets, payable for securities purchased and certain other liabilities approximated their fair values at September 30, 2026, due to their respective short maturities. As these financial instruments are not actively traded, their respective fair values are classified within Level 2.
At September 30, 2026, the Company’s senior notes were carried at their cost, net of debt issuance costs, of $4.3 billion and had a fair value of $3.8 billion. At December 31, 2025, the Company’s senior notes were carried at their cost, net of debt issuance costs, of $2.7 billion and had a fair value of $2.5 billion. The fair values of the senior notes were obtained from a third party pricing service and are based on observable market inputs. As such, the fair values of the senior notes are classified within Level 2.
10.    Derivative Instruments
The Company’s investment strategy allows for the use of derivative instruments. The Company’s derivative instruments are recorded on its consolidated balance sheets at fair value. The Company utilizes exchange traded U.S. Treasury notes, Eurodollar and other futures contracts and commodity futures to manage portfolio duration or replicate investment positions in its portfolios and the Company routinely utilizes foreign currency forward contracts, currency options, index futures contracts and other derivatives as part of its total return objective. In addition, certain of the Company’s investments are managed in portfolios which incorporate the use of foreign currency forward contracts which are intended to provide an economic hedge against foreign currency movements. 
From time to time, the Company purchases to-be-announced mortgage backed securities (“TBAs”) as part of its investment strategy. TBAs represent commitments to purchase a future issuance of agency mortgage backed securities. For the period between purchase of a TBA and issuance of the underlying security, the Company’s position is accounted for as a derivative. The Company purchases TBAs in both long and short positions to enhance investment performance and as part of its overall investment strategy.
The following table summarizes information on the fair values and notional values of the Company’s derivative instruments:
Estimated Fair Value
Asset Derivatives (1)Liability Derivatives (1)Notional
Value (2)
September 30, 2026
Futures contracts$63 $(68)$4,738 
Foreign currency forward contracts55 (30)2,363 
Other (3)166 (94)1,293 
Total$284 $(192)
December 31, 2025
Futures contracts$81 $(19)$8,022 
Foreign currency forward contracts75 (38)2,458 
Other (3)24 (15)161 
Total$180 $(72)
(1)    The fair value of asset derivatives are included in ‘other assets’ and the fair value of liability derivatives are included in ‘other liabilities.’
(2)    Represents the absolute notional value of all outstanding contracts, consisting of long and short positions.
(3)    Includes swaps, options and other derivatives contracts.

The Company did not hold any derivatives that were designated as hedging instruments at September 30, 2026 or December 31, 2025.
The Company’s derivative instruments can be traded under master netting agreements, which establish terms that apply to all derivative transactions with a counterparty. In the event of a bankruptcy or other stipulated event of default, such agreements provide that the non-defaulting party may elect to terminate all outstanding derivative transactions, in which case all individual derivative positions (loss or gain) with a counterparty are closed out and netted and replaced with a single amount, usually referred to as the termination amount, which is expressed in a single currency. The resulting single net amount, where positive, is payable to the party “in-the-money” regardless of whether or not it is the defaulting party, unless the parties have agreed that only the non-defaulting party is entitled to receive a termination payment where the net amount is positive and is in its favor. Contractual close-out netting reduces derivative credit exposure from gross to net exposure.
At September 30, 2026, asset derivatives and liability derivatives of $284 million and $192 million, respectively, were subject to a master netting agreement, compared to $180 million and $72 million, respectively, at December 31, 2025.
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2026 THIRD QUARTER FORM 10-Q
ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Realized and unrealized contract gains or losses on the Company’s derivative instruments are reflected in ‘net realized gains (losses)’ in the consolidated statements of income, as summarized in the following table:
Derivatives not designated asSeptember 30,
hedging instruments:20262025
Three Months Ended
Net realized gains (losses):
Futures contracts$(98)$37 
Foreign currency forward contracts1 (12)
Other (1)43 5 
Total$(54)$30 
Nine Months Ended
Net realized gains (losses):
Futures contracts$(188)$176 
Foreign currency forward contracts(10)71 
Other (1)50 45 
Total$(148)$292 
(1)    Includes realized gains or losses on swaps, options and other derivatives contracts.
11.    Commitments and Contingencies
Senior Notes
On June 9, 2026, Arch Capital completed a public offering of $600 million aggregate principal amount of 5.250% senior notes due 2036 (the “2036 Notes”) and $1.4 billion aggregate principal amount of 5.950% senior notes due 2056, (the “2056 Notes” and, together with the 2036 Notes, the “Notes”). The Notes are senior unsecured obligations of Arch Capital and rank equally with all of its existing and future senior unsecured indebtedness. Interest payments on the Notes are due semi-annually in arrears on June 15 and December 15, beginning on December 15, 2026, to holders of record on the preceding June 1 and December 1, as the case may be. Subject to conditions of redemption, Arch Capital may redeem all or any portion of the 2036 Notes and 2056 Notes at any time and from time to time (i) prior to March 15, 2036 and December 15, 2055, respectively, at a redemption price equal to the “make-whole” redemption price for the notes to be redeemed, plus accrued and unpaid interest thereon to, but excluding, the redemption date; and (ii) on or after March 15, 2036 and December 15, 2055, respectively, at a redemption price for the notes to be redeemed equal to 100% of the principal amount of such notes, plus accrued and unpaid interest to, but excluding, the redemption date.
Arch Capital used a portion of the net proceeds of the Notes to purchase the notes validly tendered (and not withdrawn) in connection with the tender offers, as described below, and intends to use the remaining net proceeds to redeem, repurchase, repay or otherwise retire the existing 4.011% Senior Notes due in 2026 and use the balance for general corporate purposes.
Tender Offers
On June 2, 2026, Arch Capital announced the commencement of cash tender offers (the “Tender Offers”) by Arch Capital Group (U.S.) Inc. (“Arch-U.S.”) of its outstanding 5.144% Senior Notes due 2043 (the “2043 Notes”) and Arch Capital Finance LLC (“Arch Finance”) of its outstanding 5.031% Senior Notes due 2046 (the “2046 Notes”). Upon expiration of the Tender Offers, Arch-U.S. repurchased $218.7 million aggregate principal amount of the 2043 Notes and Arch Finance repurchased $199.1 million aggregate principal amount of the 2046 Notes, which resulted in a pre-tax gain of $16 million.
Interest Paid
Interest paid on the Company’s senior notes and other borrowings was $65 million for the nine months ended September 30, 2026, compared to $64 million for the 2025 period.
Investment Commitments
The Company’s investment commitments, which are primarily related to agreements entered into by the Company to invest in funds and separately managed accounts when called upon, were approximately $4.6 billion at September 30, 2026, compared to $3.7 billion at December 31, 2025.
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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
12.    Variable Interest Entities
Bellemeade Re
The Company has entered into aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda (the “Bellemeade Agreements”). At the time the Bellemeade Agreements were entered into, the applicability of the accounting guidance that addresses variable interest entities (“VIEs”) was evaluated. As a result of the evaluation of the Bellemeade Agreements, the Company concluded that these entities are VIEs. However, given that the ceding insurers do not have the unilateral power to direct those activities that are significant to their economic performance, the Company does not consolidate such entities in its consolidated financial statements. The reinsurance premium paid in regard to the Bellemeade Agreements is calculated by multiplying the outstanding reinsurance coverage amount at the beginning of the period by the coupon rate, which is the Secured Overnight Financing Rate (“SOFR”) plus a contractual risk margin, less the actual investment income collected during the preceding month on the assets included in the underlying reinsurance trusts. In the event the assets included in the underlying reinsurance trusts became severely impaired or worthless and the special purpose reinsurance companies were unable to meet their future obligations, the Company’s mortgage insurance subsidiaries would be liable to fulfill claim payments to policyholders. The Company’s maximum exposure to loss associated with these VIEs is determined as the amount of mortgage insurance claim payments on the insured policies, net of aggregate reinsurance payments previously received, up to the full aggregate excess of loss reinsurance coverage amounts.
The following table summarizes the total assets of the Bellemeade entities:
September 30,
2026		December 31, 2025
Bellemeade Entities
(Issue Date)		Total VIE AssetsCoverage Remaining from Reinsurers (1)Total VIE
Assets
2021-3 Ltd. (Sep-21)19 7 21 
2022-1 Ltd. (Jan-22)43 9 42 
2022-2 Ltd. (Sep-22)44 77 43 
2023-1 Ltd. (Oct-23)114 28 149 
2024-1 Ltd. (Aug-24)59 15 130 
2025-1 Ltd. (Nov-25)163 41 191 
Total $442 $177 $576 
(1)    Coverage from a separate panel of reinsurers remaining at September 30, 2026.
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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
13.    Other Comprehensive Income (Loss)
The following tables present details about amounts reclassified from accumulated other comprehensive income (“AOCI”) and the tax effects allocated to each component of other comprehensive income (loss):
Amounts Reclassified from AOCI
Consolidated Statement of IncomeThree Months EndedNine Months Ended
Details AboutLine Item That IncludesSeptember 30,September 30,
AOCI ComponentsReclassification2026202520262025
Unrealized appreciation (decline) on available-for-sale investments
Net realized gains (losses)$(79)$44 $(110)$(5)
Provision for credit losses(4)4 (3)(4)
Total before tax(83)48 (113)(9)
Income tax (expense) benefit16 (7)22 5 
Net of tax$(67)$41 $(91)$(4)
Before Tax AmountTax Expense (Benefit)Net of Tax Amount
Three Months Ended September 30, 2026
Unrealized appreciation (decline) in value of investments:
Unrealized holding gains (losses) arising during period$(854)$(130)$(724)
Less reclassification of net realized gains (losses) included in net income(83)(16)(67)
Foreign currency translation adjustments(6)— (6)
Other comprehensive income (loss)$(777)$(114)$(663)
Three Months Ended September 30, 2025
Unrealized appreciation (decline) in value of investments:
Unrealized holding gains (losses) arising during period$118 $30 $88 
Less reclassification of net realized gains (losses) included in net income48 7 41 
Foreign currency translation adjustments— (1)1 
Other comprehensive income (loss)$70 $22 $48 
Nine Months Ended September 30, 2026
Unrealized appreciation (decline) in value of investments:
Unrealized holding gains (losses) arising during period$(1,284)$(127)$(1,157)
Less reclassification of net realized gains (losses) included in net income(113)(22)(91)
Foreign currency translation adjustments(13)2 (15)
Other comprehensive income (loss)$(1,184)$(103)$(1,081)
Nine Months Ended September 30, 2025
Unrealized appreciation (decline) in value of investments:
Unrealized holding gains (losses) arising during period$667 $42 $625 
Less reclassification of net realized gains (losses) included in net income(9)(5)(4)
Foreign currency translation adjustments88 (3)91 
Other comprehensive income (loss)$764 $44 $720 
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ARCH CAPITAL GROUP LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
14.    Income Taxes
The Company’s income tax provision on income before income taxes, including income (loss) from operating affiliates, resulted in an effective tax rate of 12.4% for the nine months ended September 30, 2026, compared to 14.8% for the nine months ended September 30, 2025. The decrease in the effective tax rate was primarily driven by tax law changes in Bermuda and the United Kingdom. The Company’s effective tax rate, which is based upon the expected annual effective tax rate, may fluctuate from period to period based on the relative mix of income or loss reported by jurisdiction and the varying tax rates in each jurisdiction.
The Company had a net deferred tax asset of $1.3 billion at September 30, 2026, compared to a net deferred tax asset of $1.4 billion at December 31, 2025. In addition, the Company paid $303 million of income taxes for the nine months ended September 30, 2026, compared to $315 million of income taxes paid for the nine months ended September 30, 2025.
15.    Legal Proceedings
The Company, in common with the insurance industry in general, is subject to litigation and arbitration in the normal course of its business. As of September 30, 2026, the Company was not a party to any litigation or arbitration which is expected by management to have a material adverse effect on the Company’s results of operations and financial condition and liquidity.
16.    Transactions with Related Parties
Premia Reinsurance Ltd. is a multi-line Bermuda reinsurance company (and its affiliates together with Premia Holdings Ltd., “Premia”). The Company has entered into certain reinsurance transactions with Premia. During the nine months ended September 30, 2026 and 2025, the Company did not enter into any new reinsurance transactions with Premia. At September 30, 2026, the Company recorded a funds held asset from Premia of $20 million, compared to $124 million at December 31, 2025.
Somers Group Holdings Ltd. and its wholly owned subsidiaries (collectively, “Somers”) are wholly owned by Greysbridge. For the nine months ended September 30, 2026, the Company’s net premiums written was reduced by $393 million as a result of certain reinsurance transactions with Somers, compared to a reduction of $557 million for the nine months ended September 30, 2025. In addition, Somers paid certain acquisition costs and administrative fees to the Company. At September 30, 2026, the Company recorded a reinsurance recoverable on unpaid and paid losses from Somers of $2.1 billion and a reinsurance balance payable to Somers of $581 million, compared to $2.0 billion and $550 million, respectively, at December 31, 2025.
Pursuant to the terms of the Greysbridge shareholder agreement, as amended, following the expiration of a specified period, Arch Capital has a call right (but not the obligation) and certain third party investors have put rights (but not the obligation) to purchase or sell, as applicable, a specified amount of each such investor’s initial common shares on an annual basis at Greysbridge’s year-end book value per share. In 2025, two third party investors delivered put options to sell a certain amount of their initial Greysbridge shares. A portion of the shares subject to such put option notices were purchased in the 2026 third quarter and the remaining shares are subject to regulatory approval. During the 2026 third quarter, two third party investors each delivered a put option notice to sell a certain amount of their initial Greysbridge shares. Such transactions will not close prior to 2027 and are subject to regulatory approval. Obligations under put/call option notices are recognized on the Company’s balance sheet in both other assets and other liabilities. At September 30, 2026, the Company’s balance sheet included $436 million in both other assets and other liabilities for such put notices.
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2026 THIRD QUARTER FORM 10-Q
ITEM 2.     MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion and analysis of our financial condition and results of operations. This should be read in conjunction with our consolidated financial statements included in Item 1 of this report and also our Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”). In addition, readers should review “Risk Factors” set forth in Item 1A of Part I of our 2025 Form 10-K and “ITEM 1A—Risk Factors” of this Form 10-Q. All amounts are in millions, except per share amounts, unless otherwise noted.
Arch Capital Group Ltd. (“Arch Capital” and, together with its subsidiaries, “Arch”, “the Company”, “we”, “our” or “us”) is a publicly listed Bermuda exempted company with approximately $27.3 billion in capital at September 30, 2026 and, through operations in Bermuda, the United States, Europe, Canada and Australia, writes insurance, reinsurance and mortgage insurance on a worldwide basis.
Page No.
Current Outlook
Financial Measures
Comment on Non-GAAP Financial Measures
Results of Operations
Insurance Segment
Reinsurance Segment
Mortgage Segment
Corporate
Critical Accounting Policies, Estimates and Recent Accounting Pronouncements
Financial Condition
Liquidity
Capital Resources
Catastrophic and Severe Economic Events
Market Sensitive Instruments and Risk Management
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Table of Contents
CURRENT OUTLOOK
We delivered a strong 2026 third quarter, with attractive underwriting margins reflecting the disciplined execution of our underwriting and capital management strategies. For the quarter, we generated an annualized net income return on average common equity and an annualized operating return on average common equity of 18.1% and 16.0%, respectively. See “Comment on Non-GAAP Financial Measures.” Critical to our cycle management is emphasizing underwriting discipline, as we continue to leverage our diversified specialty platform and the expertise of our underwriting teams. We invest and use data and analytics to sharpen insights, enhance risk selection and deliver a differentiated customer experience while fostering a culture that attracts the best-in-class talent. Our strong balance sheet permits us to both invest in our business and return capital to investors. We repurchased $1.4 billion of our shares in the 2026 third quarter and $3.4 billion on a year-to-date basis.
Although competitive conditions have increased across portions of the insurance and reinsurance markets, we believe the market remains constructive. While there is softening in certain lines, others continue to benefit from favorable pricing and underwriting conditions. We believe in this environment, our diversified specialty platform, underwriting expertise and disciplined approach to cycle management, position us to continue to generate attractive risk-adjusted returns while delivering long-term solutions for our clients. We remain focused on allocating capital to the opportunities that best meet our return objectives while maintaining the flexibility to adapt as market conditions evolve and remaining a reliable business partner throughout the insurance cycle.
Our insurance segment reported $108 million of underwriting income for the 2026 third quarter. We continue to see attractive opportunities in certain casualty focused lines, including excess and surplus casualty, construction and national accounts casualty in the U.S., as well as select specialty lines within our London market business. We believe that adverse development emerging across the industry for more recent accident years reinforces the need for casualty pricing to remain at or above loss cost trend. These opportunities were partially offset by our planned non-renewal of certain middle market commercial program business which we acquired from Allianz in 2024 (the “MCE Acquisition”) and continued competitive pressure in property and certain short tail lines. We expect underlying premium growth to remain measured under current market conditions, while we continue to seek opportunities to grow in areas where pricing, terms and conditions support our return objectives.
Our reinsurance segment contributed $393 million of underwriting income in the 2026 third quarter, benefiting from relatively light catastrophe activity. Net premiums written were $1.6 billion, down roughly 9% when compared to the 2025 third quarter, reflecting abundant market capacity, lower rates and reduced participation across a number of property and other short tail lines. We expect continued pricing pressure within property catastrophe and other short tail lines. While casualty business continues to provide selective opportunities, available capacity and competitive terms and conditions may limit our ability to grow this business. Consistent with our cycle management, we look to manage our net portfolio and stay in front of clients by finding solutions for our cedants and brokers. Although declining rates may place gradual pressure on underwriting margins, we believe our global reach, underwriting expertise, market position and access to traditional reinsurance and third party capital provide us with the flexibility to respond as opportunities emerge.
Our mortgage segment continued to deliver a steady level of earnings, generating $201 million of underwriting income in the 2026 third quarter. New originations remained modest due to affordability challenges tied to mortgage rates and home prices, which continued to constrain demand. We believe the underlying fundamentals of our mortgage portfolio remain strong, and our U.S. market share was stable. While our delinquency rate remained low, the persistency of our in-force U.S. primary mortgage insurance portfolio stayed healthy at 79.2%, an important factor in the sustainability of future premium flow. We continue to expect the mortgage segment to serve as a steady diversifying contributor to our overall earnings and generate attractive underwriting income given the high credit quality of our in-force portfolio. We also continue to identify opportunities in our businesses outside of U.S. primary mortgage insurance, which provide further diversification within the segment.
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2026 THIRD QUARTER FORM 10-Q
Table of Contents
FINANCIAL MEASURES
Management uses the following three key financial indicators in evaluating our performance and measuring the overall growth in value generated for Arch Capital’s common shareholders:
Book Value per Share
Book value per share represents total common shareholders’ equity available to Arch divided by the number of common shares outstanding. Management uses growth in book value per share as a key measure of the value generated for our common shareholders each period and believes that book value per share is the key driver of Arch Capital’s share price over time. Book value per share is impacted by, among other factors, our underwriting results, investment returns and share repurchase activity, which has an accretive or dilutive impact on book value per share depending on the purchase price. Book value per share was $67.90 at September 30, 2026, compared to $68.04 at June 30, 2026, and $62.32 at September 30, 2025. The 0.2% decrease in book value per share for the 2026 third quarter primarily reflected the impact of share repurchases at an average price higher than book value along with the impact of rising interest rates on the fair value of our available for sale investment portfolio.
Operating Return on Average Common Equity
Operating return on average common equity (“Operating ROAE”) represents annualized after-tax operating income available to Arch common shareholders divided by the average of beginning and ending common shareholders’ equity available to Arch during the period. After-tax operating income available to Arch common shareholders, a non-GAAP financial measure as defined in Regulation G, represents net income available to Arch common shareholders, excluding net realized gains or losses (which include, but are not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other and income taxes. Management uses Operating ROAE as a key measure of the return generated to common shareholders. See “Comment on Non-GAAP Financial Measures.”
Our annualized net income return on average common equity was 18.1% for the 2026 third quarter, compared to 23.8% for the 2025 third quarter, and 18.2% for the nine months ended September 30, 2026, compared to 19.5% for the 2025 period. Our Operating ROAE was 16.0% for the 2026 third quarter, compared to 18.5% for the 2025 third quarter and 15.8% for the nine months ended September 30, 2026, compared to 16.2% for the 2025 period.
Total Return on Investments
Total return on investments, a non-GAAP financial measure as defined in Regulation G, includes investment income, equity in net income or loss of investments accounted for using the equity method, net realized gains or losses attributable to the investment portfolio and the change in unrealized gains or losses generated by Arch’s investment portfolio. Total return is calculated on a pre-tax basis and before investment expenses and reflects the effect of financial market conditions along with foreign currency fluctuations. In addition, total return incorporates the timing of investment returns during the periods. The following table summarizes our total return compared to the benchmark return against which we measured our portfolio during the periods. See “Comment on Non-GAAP Financial Measures.”
Arch
Portfolio		Benchmark
Return
Pre-tax total return (before investment expenses):
2026 Third Quarter(0.42)%(0.67)%
2025 Third Quarter1.80 %1.81 %
Nine Months Ended September 30, 20261.29 %1.08 %
Nine Months Ended September 30, 20257.07 %7.27 %
Total return for the 2026 periods primarily reflected the impact of rising U.S. Treasury yields on our fixed income portfolio, for which we continue to maintain a relatively short duration of 3.25 years at September 30, 2026, in line with our asset allocation targets.
The benchmark return index is a customized combination of indices intended to approximate a target portfolio by asset mix and average credit quality with a fixed income component matching the approximate estimated duration and currency mix of our insurance and reinsurance liabilities. It is recalibrated annually. Although the estimated fixed income duration and average credit quality of this index will move as the duration and rating of its constituent securities change, generally we do not adjust the composition of the benchmark return index during the year except to incorporate changes to the mix of liability currencies and durations noted above. The benchmark return index should not be interpreted as expressing a preference for or aversion to any particular sector or sector weight. At September 30, 2026, the fixed income portion of the benchmark had an
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2026 THIRD QUARTER FORM 10-Q
average credit quality of “A1” by Moody’s and an estimated fixed income duration of 3.25 years.
The benchmark return index included weightings to the following indices:
%
ICE BofA 1-10 Year U.S. Corporate Index
24.80 
Yield on 3-5 Year U.S. Treasury Index plus 5.5%16.00 
ICE BofA 1-10 Year U.S. Treasury Index15.00 
ICE BofA 0-3 Month U.S. Treasury Index3.00 
ICE BofA BB-B U.S. High Yield Constrained Index5.50 
JPM CLOIE Investment Grade5.00 
ICE BofA 3-5 Year U.S. Agency CMO Excluding IO & PO Index5.00 
ICE BofA U.S. Fixed Rate CMBS Index4.00 
ICE BofA U.S. Fixed & Floating Rate Asset Backed Securities Index2.50 
S&P 500 Total Return Index4.25 
ICE BofA 1-5 Year U.K. Gilt Index5.90 
ICE BofA German Government 1-5 Year Index3.00 
ICE BofA German Government 5-7 Year Index1.00 
ICE BofA 1-5 Year Canada Government Index2.75 
ICE BofA 15+ Year Canada Government Index0.25 
ICE BofA 1-5 Year Australia Government Index1.50 
ICE BofA 5-10 Year Australia Government Index0.40 
ICE BofA 1-5 Year Japan Government Index0.15 
Total
100.00 %
COMMENT ON NON-GAAP FINANCIAL MEASURES
Throughout this filing, we present our operations in the way we believe will be the most meaningful and useful to investors, analysts, rating agencies and others who use our financial information in evaluating the performance of our company. This presentation includes the use of after-tax operating income available to Arch common shareholders, which is defined as net income available to Arch common shareholders, excluding net realized gains or losses (which include, but are not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses, transaction costs and other, income taxes, and the use of annualized operating return on average common equity. The presentation of after-tax operating income available to Arch common shareholders and annualized operating return on average common equity are non-GAAP financial measures as defined in Regulation G. The reconciliation of such measures to net income available to Arch common shareholders and annualized net income return on average common equity
(the most directly comparable GAAP financial measures) in accordance with Regulation G is included under “Results of Operations” below.
We believe that net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other in any particular period are not indicative of the performance of, or trends in, our business. Although net realized gains or losses, equity in net income or loss of investments accounted for using the equity method and net foreign exchange gains or losses are an integral part of our operations, the decision to realize these items, are independent of the insurance underwriting process and result, in large part, from general economic and financial market conditions. Furthermore, certain users of our financial information believe that, for many companies, the timing of the realization of investment gains or losses is largely opportunistic. In addition, changes in the allowance for credit losses and net impairment losses recognized in earnings on our investments represent other-than-temporary declines in expected recovery values on securities without actual realization. Furthermore, we exclude net realized gains or losses from the acquisition or disposition of subsidiaries, due to their non-recurring nature, such items are not indicative of the performance of, or trends in, our business performance.
The use of the equity method on certain of our investments funds that invest in fixed maturity securities is driven by the ownership structure of such funds (either limited partnerships or limited liability companies). In applying the equity method, these investments are initially recorded at cost and are subsequently adjusted based on our proportionate share of the net income or loss of the funds (which include changes in the market value of the underlying securities in the funds). This method of accounting is different from the way in which we account for our other investments; and, the timing of the recognition of equity in net income or loss of investments accounted for using the equity method may differ from gains or losses in the future upon sale or maturity of such investments.
Transaction costs and other include integration, advisory, financing, legal, severance, incentive compensation and all other transaction costs directly related to acquisitions. We believe that transaction costs and other, due to their nonrecurring nature, are not indicative of the performance of, or trends in, our business performance.
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2026 THIRD QUARTER FORM 10-Q
We believe that showing net income available to Arch common shareholders exclusive of the items referred to above reflects the underlying fundamentals of our business since we evaluate the performance of and manage our business to produce an underwriting profit. In addition to presenting the net income available to Arch common shareholders, we believe that this presentation enables investors and other users of our financial information to analyze our performance in a manner similar to how management analyzes performance. We also believe that this measure follows industry practice and, therefore, allows the users of financial information to compare our performance with our industry peer group. We believe that the equity analysts and certain rating agencies that follow us and the insurance industry as a whole generally exclude these items from their analyses for the same reasons.
Our segment information includes the presentation of consolidated underwriting income or loss. Such measures represent the pre-tax profitability of our underwriting operations and include net premiums earned plus other underwriting income, less losses and loss adjustment expenses, acquisition expenses and other operating expenses. Other operating expenses include those operating expenses that are incremental and/or directly attributable to our individual underwriting operations. Underwriting income or loss does not incorporate certain income and expense items which are included in corporate. While these measures are presented in note 5, “Segment Information,” to our consolidated financial statements, they are considered non-GAAP financial measures when presented elsewhere on a consolidated basis. The reconciliations of underwriting income or loss to income before income taxes (the most directly comparable GAAP financial measure) on a consolidated basis, in accordance with Regulation G, is shown in note 5, “Segment Information” to our consolidated financial statements.
We measure segment performance for our three underwriting segments based on underwriting income or loss. We do not manage our assets by underwriting segment, with the exception of goodwill and intangible assets, and, accordingly, investment income, income from operating affiliates and other non-underwriting related items are not allocated to each underwriting segment.
Our presentation of segment information includes the use of a current year loss ratio which excludes favorable or adverse development in prior year loss reserves. This ratio is a non-GAAP financial measure as defined in Regulation G. The reconciliation of such measure to the loss ratio (the most directly comparable GAAP financial measure) in accordance with Regulation G is shown on the individual segment pages. Management utilizes the current year loss ratio in its analysis of the underwriting performance of each of our underwriting segments. The ‘Other operating expense ratio’ includes ‘Other underwriting income.’
Total return on investments includes investment income, equity in net income or loss of investments accounted for using the equity method, net realized gains or losses (excluding net realized gains or losses on non-investment related financial assets) and the change in unrealized gains or losses generated by Arch’s investment portfolio. Total return is calculated on a pre-tax basis and before investment expenses, and reflects the effect of financial market conditions along with foreign currency fluctuations. In addition, total return incorporates the timing of investment returns during the periods. There is no directly comparable GAAP financial measure for total return. Management uses total return on investments as a key measure of the return generated to Arch common shareholders on the capital held in the business, and compares the return generated by our investment portfolio against benchmark returns which we measured our portfolio against during the periods.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
RESULTS OF OPERATIONS
The following table summarizes our consolidated financial data, including a reconciliation of net income or loss available to Arch common shareholders to after-tax operating income or loss available to Arch common shareholders. See “Comment on Non-GAAP Financial Measures.”
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Net income available to Arch common shareholders$1,025 $1,340 $3,109 $3,131 
Net realized (gains) losses (1)99 (210)203 (442)
Equity in net (income) loss of investments accounted for using the equity method(224)(134)(580)(349)
Net foreign exchange (gains) losses(18)7 (49)122 
Transaction costs and other17 21 67 49 
Income tax expense (benefit) (2)11 18 (46)97 
After-tax operating income available to Arch common shareholders$910 $1,042 $2,704 $2,608 
Beginning common shareholders’ equity$23,200 $22,211 $23,376 $19,990 
Ending common shareholders’ equity22,162 22,889 22,162 22,889 
Average common shareholders’ equity$22,681 $22,550 $22,769 $21,440 
Annualized net income return on average common equity %18.1 23.8 18.2 19.5 
Annualized operating return on average common equity %16.0 18.5 15.8 16.2 
(1)    Net realized gains or losses include, but are not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries.
(2)    Income tax expense on net realized gains or losses, equity in net income or loss of investments accounted for using the equity method, net foreign exchange gains or losses and transaction costs and other reflects the relative mix reported by jurisdiction and the varying tax rates in each jurisdiction.
Segment Information
We classify our businesses into three underwriting segments: insurance, reinsurance and mortgage. Our insurance, reinsurance and mortgage segments each have managers who are responsible for the overall profitability of their respective segments and who are directly accountable to our chief operating decision makers (“CODMs”), the Chief Executive Officer of Arch Capital and the Chief Financial Officer and Treasurer of Arch Capital. The CODMs do not assess performance, measure return on equity or make resource allocation decisions on a line of business basis. Management measures segment performance for our three underwriting segments based on underwriting income or loss. We do not manage our assets by underwriting segment, with the exception of goodwill and intangible assets and accordingly investment income is not allocated to each underwriting segment.
We determined our reportable segments using the management approach described in accounting guidance regarding disclosures about segments of an enterprise and related information. The accounting policies of the segments are the same as those used for the preparation of our consolidated financial statements. Intersegment business is allocated to the segment accountable for the underwriting results.
Insurance Segment
The Company’s insurance segment primarily consists of commercial insurance lines of business, with a focus on specialty insurance products. These products are mainly offered in North America, Bermuda, the United Kingdom, continental Europe and Australia. Products offered in North America include: commercial automobile; commercial multi-peril; other liability-claims made, which includes financial and professional lines; other liability-occurrence, which includes admitted and excess and surplus casualty lines; property and short-tail specialty; workers compensation; and other. Products offered across the Company’s International units include: property and short-tail specialty; and casualty and other.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
The following tables set forth our insurance segment’s underwriting results:
Three Months Ended September 30,
20262025% Change
Gross premiums written$2,766 $2,567 7.8 
Premiums ceded(760)(614)
Net premiums written2,006 1,953 2.7 
Change in unearned premiums(69)16 
Net premiums earned1,937 1,969 (1.6)
Other underwriting income (1)15 9 
Losses and loss adjustment expenses(1,178)(1,162)
Acquisition expenses(371)(386)
Other operating expenses(295)(301)
Underwriting income (loss)$108 $129 (16.3)
Underwriting Ratios% Point
Change
Loss ratio60.8 %59.0 %1.8 
Acquisition expense ratio19.2 %19.6 %(0.4)
Other operating expense ratio (2)14.4 %14.8 %(0.4)
Combined ratio94.4 %93.4 %1.0 
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
Nine Months Ended September 30,
20262025% Change
Gross premiums written$8,066 $7,893 2.2 
Premiums ceded(2,221)(1,971)
Net premiums written5,845 5,922 (1.3)
Change in unearned premiums(157)(124)
Net premiums earned5,688 5,798 (1.9)
Other underwriting income (1)41 25 
Losses and loss adjustment expenses(3,489)(3,568)
Acquisition expenses(1,121)(1,116)
Other operating expenses(918)(883)
Underwriting income (loss)$201 $256 (21.5)
Underwriting Ratios% Point
Change
Loss ratio61.3 %61.5 %(0.2)
Acquisition expense ratio19.7 %19.3 %0.4 
Other operating expense ratio (2)15.4 %14.8 %0.6 
Combined ratio96.4 %95.6 %0.8 
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
Premiums Written.
The following tables set forth our insurance segment’s net premiums written by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
North America
Other liability - occurrence$363 18.1 $297 15.2 
Property and short-tail specialty303 15.1 339 17.4 
Other liability - claims made192 9.6 209 10.7 
Workers compensation172 8.6 151 7.7 
Commercial automobile167 8.3 150 7.7 
Commercial multi-peril128 6.4 194 9.9 
Other92 4.6 86 4.4 
Total North America 1,417 70.6 1,426 73.0 
International
Property and short-tail specialty$314 15.7 $284 14.5 
Casualty and other275 13.7 243 12.4 
Total International 589 29.4 527 27.0 
Total$2,006 100.0 $1,953 100.0 
2026 Third Quarter versus 2025 Period. Gross premiums written by the insurance segment in the 2026 third quarter were 7.8% higher than in the 2025 third quarter, while net premiums written were 2.7% higher than in the 2025 third quarter. Adjusting for the non-renewal of certain programs related to the MCE Acquisition, net premiums written would have increased by 5.8% compared to the same quarter one year ago and reflected strong growth in international business.
Nine Months Ended September 30,
20262025
Amount%Amount%
North America
Other liability - occurrence$1,042 17.8 $993 16.8 
Property and short-tail specialty987 16.9 1,056 17.8 
Other liability - claims made579 9.9 564 9.5 
Workers compensation450 7.7 434 7.3 
Commercial automobile474 8.1 476 8.0 
Commercial multi-peril431 7.4 597 10.1 
Other253 4.3 251 4.2 
Total North America 4,216 72.1 4,371 73.8 
International
Property and short-tail specialty$876 15.0 $851 14.4 
Casualty and other753 12.9 700 11.8 
Total International 1,629 27.9 1,551 26.2 
Total$5,845 100.0 $5,922 100.0 
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Nine Months Ended September 30, 2026 versus 2025 period. Gross premiums written by the insurance segment for the nine months ended September 30, 2026 were 2.2% higher than in the 2025 period, while net premiums written were 1.3% lower than in the 2025 period. Adjusting for the non-renewal of certain programs related to the MCE Acquisition, net premiums written would have increased by 1.6% compared to a year ago and reflected strong growth in international business.
Net Premiums Earned.
The following tables set forth our insurance segment’s net premiums earned by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
North America
Other liability - occurrence$307 15.8 $329 16.7 
Property and short-tail specialty333 17.2 339 17.2 
Other liability - claims made205 10.6 205 10.4 
Workers compensation153 7.9 160 8.1 
Commercial automobile148 7.6 143 7.3 
Commercial multi-peril136 7.0 195 9.9 
Other74 3.8 70 3.6 
Total North America 1,356 70.0 1,441 73.2 
International
Property and short-tail specialty$329 17.0 $292 14.8 
Casualty and other252 13.0 236 12.0 
Total International 581 30.0 528 26.8 
Total$1,937 100.0 $1,969 100.0 
Nine Months Ended September 30,
20262025
Amount%Amount%
North America
Other liability - occurrence$896 15.8 $996 17.2 
Property and short-tail specialty982 17.3 1,035 17.9 
Other liability - claims made604 10.6 583 10.1 
Workers compensation423 7.4 438 7.6 
Commercial automobile442 7.8 435 7.5 
Commercial multi-peril516 9.1 599 10.3 
Other219 3.9 213 3.7 
Total North America 4,082 71.8 4,299 74.1 
International
Property and short-tail specialty$885 15.6 $816 14.1 
Casualty and other721 12.7 683 11.8 
Total International 1,606 28.2 1,499 25.9 
Total$5,688 100.0 $5,798 100.0 
Net premiums written are primarily earned on a pro rata basis over the terms of the policies for all products, usually 12 months. Net premiums earned reflect changes in net premiums written over the previous five quarters. Net premiums earned for the 2026 third quarter were 1.6% lower than in the 2025 third quarter, while net premiums earned for the nine months ended September 30, 2026 were 1.9% lower than in the 2025 period.
Other Underwriting Income.
Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts, was $15 million for the 2026 third quarter, compared to $9 million for the 2025 third quarter, and $41 million for the nine months ended September 30, 2026, compared to $25 million for the 2025 period.
Losses and Loss Adjustment Expenses.
The table below shows the components of the insurance segment’s loss ratio:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Current year61.5 %59.7 %62.3 %62.2 %
Prior period reserve development(0.7)%(0.7)%(1.0)%(0.7)%
Loss ratio60.8 %59.0 %61.3 %61.5 %
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Current Year Loss Ratio.
2026 Third Quarter versus 2025 Period. The insurance segment’s current year loss ratio in the 2026 third quarter was 1.8 points higher than in the 2025 third quarter. The 2026 third quarter loss ratio reflected 5.7 points of current year catastrophic activity, which includes losses related to the Iran conflict, compared to 2.2 points of current year catastrophic activity in the 2025 third quarter. The balance of the change in the loss ratio resulted, in part, from the incremental earned premium in the quarter resulting from the Iran conflict.
Nine Months Ended September 30, 2026 versus 2025 Period. The insurance segment’s current year loss ratio for the nine months ended September 30, 2026 was 0.1 points higher than in the 2025 period and reflected 5.8 points of current year catastrophic activity, primarily related to the Iran conflict and severe conductive storms in the U.S., compared to 4.8 points in the 2025 period, primarily related to the California wildfires. The balance of the change in the loss ratio resulted, in part, from changes in mix of business.
Prior Period Reserve Development.
The insurance segment’s net favorable development was $14 million, or 0.7 points, for the 2026 third quarter, consistent with $14 million, or 0.7 points, for the 2025 third quarter, and $55 million, or 1.0 points, for the nine months ended September 30, 2026, compared to $39 million, or 0.7 points, for the 2025 period. See note 6, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements for information about the insurance segment’s prior year reserve development.
Underwriting Expenses.
2026 Third Quarter versus 2025 Period. The insurance segment’s underwriting expense ratio was 33.6% in the 2026 third quarter, compared to 34.4% in the 2025 third quarter. The 2026 third quarter ratio primarily reflected the benefit of Bermuda qualified refundable tax credits (“QRTCs”).
Nine Months Ended September 30, 2026 versus 2025 period. The insurance segment’s underwriting expense ratio was 35.1% for the nine months ended September 30, 2026, compared to 34.1% for the 2025 period.
Reinsurance Segment 
The Company’s reinsurance segment offers reinsurance products on a worldwide basis. Lines of business include: casualty; marine and aviation; specialty; property catastrophe; property excluding property catastrophe; and other.
The following tables set forth our reinsurance segment’s underwriting results:
Three Months Ended September 30,
20262025% Change
Gross premiums written$2,313 $2,515 (8.0)
Premiums ceded(737)(778)
Net premiums written1,576 1,737 (9.3)
Change in unearned premiums231 278 
Net premiums earned1,807 2,015 (10.3)
Other underwriting income (1)43 38 
Losses and loss adjustment expenses(1,010)(1,040)
Acquisition expenses(334)(398)
Other operating expenses(113)(133)
Underwriting income$393 $482 (18.5)
Underwriting Ratios% Point
Change
Loss ratio55.9 %51.6 %4.3 
Acquisition expense ratio18.5 %19.8 %(1.3)
Other operating expense ratio (2)3.9 %4.7 %(0.8)
Combined ratio78.3 %76.1 %2.2 
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
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2026 THIRD QUARTER FORM 10-Q
Nine Months Ended September 30,
20262025% Change
Gross premiums written$8,929 $9,205 (3.0)
Premiums ceded(3,333)(3,093)
Net premiums written5,596 6,112 (8.4)
Change in unearned premiums(138)18 
Net premiums earned5,458 6,130 (11.0)
Other underwriting income (1)117 123 
Losses and loss adjustment expenses(2,950)(3,524)
Acquisition expenses(1,022)(1,251)
Other operating expenses(359)(378)
Underwriting income (loss)$1,244 $1,100 13.1 
Underwriting Ratios% Point
Change
Loss ratio54.1 %57.5 %(3.4)
Acquisition expense ratio18.7 %20.4 %(1.7)
Other operating expense ratio (2)4.4 %4.2 %0.2 
Combined ratio77.2 %82.1 %(4.9)
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
Premiums Written.
The following tables set forth our reinsurance segment’s net premiums written by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
Specialty$527 33.4 $633 36.4 
Property excluding property catastrophe477 30.3 557 32.1 
Casualty428 27.2 399 23.0 
Marine and aviation54 3.4 60 3.5 
Property catastrophe42 2.7 64 3.7 
Other48 3.0 24 1.4 
Total$1,576 100.0 $1,737 100.0 
2026 Third Quarter versus 2025 Period. Gross premiums written by the reinsurance segment in the 2026 third quarter were 8.0% lower than in the 2025 third quarter, while net premiums written were 9.3% lower than in the 2025 third quarter. Reductions in net premiums written this quarter were due, in part, to non-renewals and share reductions.
Nine Months Ended September 30,
20262025
Amount%Amount%
Specialty$1,777 31.8 $1,956 32.0 
Property excluding property catastrophe1,476 26.4 1,568 25.7 
Casualty1,218 21.8 1,206 19.7 
Marine and aviation190 3.4 249 4.1 
Property catastrophe741 13.2 1,025 16.8 
Other194 3.5 108 1.8 
Total$5,596 100.0 $6,112 100.0 
Nine Months Ended September 30, 2026 versus 2025 period. Gross premiums written by the reinsurance segment for the nine months ended September 30, 2026 were 3.0% lower than in the 2025 period, while net premiums written were 8.4% lower than in the 2025 period. Reductions in net premiums written in the 2026 period were due, in part, to non-renewals, share reductions as well as targeted increased retrocessions.
Net Premiums Earned.
The following tables set forth our reinsurance segment’s net premiums earned by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
Specialty$604 33.4 $719 35.7 
Property excluding property catastrophe502 27.8 581 28.8 
Casualty401 22.2 360 17.9 
Marine and aviation61 3.4 77 3.8 
Property catastrophe191 10.6 253 12.6 
Other48 2.7 25 1.2 
Total$1,807 100.0 $2,015 100.0 
Nine Months Ended September 30,
20262025
Amount%Amount%
Specialty$1,807 33.1 $2,206 36.0 
Property excluding property catastrophe1,510 27.7 1,716 28.0 
Casualty1,121 20.5 1,040 17.0 
Marine and aviation202 3.7 239 3.9 
Property catastrophe625 11.5 819 13.4 
Other193 3.5 110 1.8 
Total$5,458 100.0 $6,130 100.0 
Net premiums written, irrespective of the class of business, are generally earned on a pro rata basis over the terms of the underlying policies or reinsurance contracts. Net premiums earned reflect changes in net premiums written over the previous five quarters. Net premiums earned for the 2026 third quarter were 10.3% lower than in the 2025 third quarter, while net premiums earned for the nine months ended September 30, 2026 were 11.0% lower than in the 2025 period.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Other Underwriting Income.
Other underwriting income, which includes revenue earned from underwriting-related activities covered under existing service contracts, was $43 million for the 2026 third quarter, compared to $38 million for the 2025 third quarter, and $117 million for the nine months ended September 30, 2026, compared to $123 million for the 2025 period.
Losses and Loss Adjustment Expenses.
The table below shows the components of the reinsurance segment’s loss ratio:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Current year63.3 %54.2 %61.1 %61.6 %
Prior period reserve development(7.4)%(2.6)%(7.0)%(4.1)%
Loss ratio55.9 %51.6 %54.1 %57.5 %
Current Year Loss Ratio.
2026 Third Quarter versus 2025 Period. The reinsurance segment’s current year loss ratio in the 2026 third quarter was 9.1 points higher than in the 2025 third quarter. The 2026 third quarter loss ratio reflected 7.5 points of current year catastrophic activity, compared to 1.3 points of current year catastrophic activity in the 2025 third quarter. The loss ratio was also impacted by changes in rate and mix of business.
Nine Months Ended September 30, 2026 versus 2025 Period. The reinsurance segment’s current year loss ratio for the nine months ended September 30, 2026 was 0.5 points lower than in the 2025 period and reflected 5.3 points of current year catastrophic activity, compared to 9.5 points in the 2025 period, primarily related to the California wildfires. The balance of the change in the loss ratio resulted, in part, from changes in mix of business.
Prior Period Reserve Development.
The reinsurance segment’s net favorable development was $133 million, or 7.4 points, for the 2026 third quarter, compared to $53 million, or 2.6 points, for the 2025 third quarter, and $382 million, or 7.0 points, for the nine months ended September 30, 2026, compared to $253 million, or 4.1 points, for the 2025 period. See note 6, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements for information about the reinsurance segment’s prior year reserve development.
Underwriting Expenses.
2026 Third Quarter versus 2025 Period. The underwriting expense ratio for the reinsurance segment was 22.4% in the 2026 third quarter, compared to 24.5% in the 2025 third quarter, with the decrease primarily reflecting the impact of higher commissions on retrocessions. The 2026 third quarter also reflected the benefit of QRTCs.
Nine Months Ended September 30, 2026 versus 2025 period. The underwriting expense ratio for the reinsurance segment was 23.1% for the nine months ended September 30, 2026, compared to 24.6% for the 2025 period. The 2026 period reflected the benefit of QRTCs.
Mortgage Segment 
The Company’s mortgage segment consists of U.S. primary mortgage insurance business written predominantly on loans sold to the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), each a government sponsored entity (“GSE”) and also through non GSE approved entities (combined “Arch MI U.S.”); reinsurance and underwriting services related to U.S. credit-risk transfer (“CRT”) business which are predominately with the GSEs and other U.S. mortgage reinsurance transactions; and international mortgage insurance and reinsurance business covering loans primarily in Australia and Europe.
The following tables set forth our mortgage segment’s underwriting results:
Three Months Ended September 30,
20262025% Change
Gross premiums written$316 $330 (4.2)
Premiums ceded(53)(56)
Net premiums written263 274 (4.0)
Change in unearned premiums7 27 
Net premiums earned270 301 (10.3)
Other underwriting income (1)3 3 
Losses and loss adjustment expenses(18)2 
Acquisition expenses(7)(2)
Other operating expenses(47)(44)
Underwriting income$201 $260 (22.7)
Underwriting Ratios% Point
Change
Loss ratio6.9 %(0.5)%7.4 
Acquisition expense ratio2.4 %0.7 %1.7 
Other operating expense ratio (2)16.2 %13.3 %2.9 
Combined ratio25.5 %13.5 %12.0 
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Nine Months Ended September 30,
20262025% Change
Gross premiums written$956 $979 (2.3)
Premiums ceded(155)(186)
Net premiums written801 793 1.0 
Change in unearned premiums38 89 
Net premiums earned839 882 (4.9)
Other underwriting income (1)19 17 
Losses and loss adjustment expenses(52)2 
Acquisition expenses(17)(7)
Other operating expenses(147)(144)
Underwriting income$642 $750 (14.4)
Underwriting Ratios% Point
Change
Loss ratio6.2 %(0.2)%6.4 
Acquisition expense ratio2.0 %0.8 %1.2 
Other operating expense ratio (2)15.2 %14.3 %0.9 
Combined ratio23.4 %14.9 %8.5 
(1)    ‘Other underwriting income’ includes revenue earned from underwriting-related activities covered under existing service contracts.
(2)    The ‘Other operating expense ratio’ includes ‘Other underwriting income.’ See ‘Comments on Non-GAAP Financial Measures’ for further details.
Premiums Written.
The following tables set forth our mortgage segment’s net premiums written by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
U.S. primary mortgage insurance $197 74.9 $197 71.9 
U.S. credit risk transfer (CRT) and other35 13.3 55 20.1 
International mortgage insurance/
reinsurance		31 11.8 22 8.0 
Total$263 100.0 $274 100.0 
2026 Third Quarter versus 2025 Period. Gross premiums written by the mortgage segment in the 2026 third quarter were 4.2% lower than in the 2025 third quarter, with lower U.S. credit risk transfer premiums and U.S. primary mortgage insurance monthly premiums partially offset by growth in international business. Net premiums written were 4.0% lower than in the 2025 third quarter, primarily reflecting lower U.S. credit risk transfer premiums, partially offset by a decrease in ceded reinsurance associated with the U.S. primary mortgage insurance business.
Nine Months Ended September 30,
20262025
Amount%Amount%
U.S. primary mortgage insurance$603 75.3 $584 73.6 
U.S. credit risk transfer (CRT) and other107 13.4 156 19.7 
International mortgage insurance/
reinsurance		91 11.4 53 6.7 
Total$801 100.0 $793 100.0 
Nine Months Ended September 30, 2026 versus 2025 Period. Gross premiums written by the mortgage segment for the nine months ended September 30, 2026 were 2.3% lower than in the 2025 period, while net premiums written for the nine months ended September 30, 2026 were 1.0% higher than in the 2025 period, primarily reflecting lower U.S. credit risk transfer premiums partially offset by growth in international business.
The persistency rate was 79.2% for the Arch MI U.S. portfolio of primary mortgage insurance policies at September 30, 2026, compared to 82.3% at September 30, 2025. The persistency rate represents the percentage of mortgage insurance in force at the beginning of a 12 month period that remains in force at the end of such period.
The following tables provide details on the new insurance written (“NIW”) generated by Arch MI U.S. NIW represents the original principal balance of all loans that received coverage during the period.

Three Months Ended September 30,
20262025
Amount%Amount%
Total new insurance written (NIW)$13,593 $12,965 
Credit quality:
>=740$10,992 80.9 $9,850 76.0 
680-7392,294 16.9 2,753 21.2 
620-679299 2.2 359 2.8 
<6208 0.1 3 0.0 
Total$13,593 100.0 $12,965 100.0 
Loan-to-value (LTV):
95.01% and above$1,012 7.4 $1,038 8.0 
90.01% to 95.00%5,937 43.7 5,668 43.7 
85.01% to 90.00%4,414 32.5 4,323 33.3 
85.00% and below2,230 16.4 1,936 14.9 
Total$13,593 100.0 $12,965 100.0 
Monthly vs. single:
Monthly$12,894 94.9 $12,267 94.6 
Single699 5.1 698 5.4 
Total$13,593 100.0 $12,965 100.0 
Purchase vs. refinance:
Purchase$12,883 94.8 $12,319 95.0 
Refinance710 5.2 646 5.0 
Total$13,593 100.0 $12,965 100.0 
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Nine Months Ended September 30,
20262025
Amount%Amount%
Total new insurance written (NIW)$44,029 $34,409 
Credit quality:
>=740$35,349 80.3 $26,096 75.8 
680-7397,611 17.3 7,383 21.5 
620-6791,027 2.3 921 2.7 
<62042 0.1 9 0.0 
Total$44,029 100.0 $34,409 100.0 
Loan-to-value (LTV):
95.01% and above$4,184 9.5 $2,608 7.6 
90.01% to 95.00%18,301 41.6 15,674 45.6 
85.01% to 90.00%14,463 32.8 11,188 32.5 
85.00% and below7,081 16.1 4,939 14.4 
Total$44,029 100.0 $34,409 100.0 
Monthly vs. single:
Monthly$42,108 95.6 $32,543 94.6 
Single1,921 4.4 1,866 5.4 
Total$44,029 100.0 $34,409 100.0 
Purchase vs. refinance:
Purchase$38,491 87.4 $32,747 95.2 
Refinance5,538 12.6 1,662 4.8 
Total$44,029 100.0 $34,409 100.0 
Net Premiums Earned.
The following tables set forth our mortgage segment’s net premiums earned by major line of business:
Three Months Ended September 30,
20262025
Amount%Amount%
U.S. primary mortgage insurance $201 74.4 $204 67.8 
U.S. credit risk transfer (CRT) and other35 13.0 55 18.3 
International mortgage insurance/
reinsurance		34 12.6 42 14.0 
Total$270 100.0 $301 100.0 
2026 Third Quarter versus 2025 Period. Net premiums earned for the 2026 third quarter were 10.3% lower than in the 2025 third quarter, reflecting changes in net premiums written over the previous five quarters.
Nine Months Ended September 30,
20262025
Amount%Amount%
U.S. primary mortgage insurance$616 73.4 $601 68.1 
U.S. credit risk transfer (CRT) and other107 12.8 156 17.7 
International mortgage insurance/
reinsurance		116 13.8 125 14.2 
Total$839 100.0 $882 100.0 
Nine Months Ended September 30, 2026 versus 2025 Period. For the nine months ended September 30, 2026, net premiums earned were 4.9% lower than in the 2025 period.
Other Underwriting Income.
Other underwriting income, which is primarily related to GSE credit risk-sharing transactions, was $3 million for the 2026 third quarter, consistent with $3 million for the 2025 third quarter, and $19 million for the nine months ended September 30, 2026, compared to $17 million for the 2025 period.
Losses and Loss Adjustment Expenses.
The table below shows the components of the mortgage segment’s loss ratio:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Current year22.3 %17.6 %23.0 %20.2 %
Prior period reserve development(15.4)%(18.1)%(16.8)%(20.4)%
Loss ratio6.9 %(0.5)%6.2 %(0.2)%
Current Year Loss Ratio.
2026 Third Quarter versus 2025 Period. The mortgage segment’s current year loss ratio was 4.7 points higher in the 2026 third quarter than in the 2025 third quarter. The current year loss ratio for the 2026 third quarter reflected a modestly higher level of delinquencies compared to the 2025 third quarter.
Nine Months Ended September 30, 2026 versus 2025 Period. The mortgage segment’s current year loss ratio was 2.8 points higher for the nine months ended September 30, 2026 than for the 2025 period. The higher current year loss ratio for the 2026 period reflected slightly higher new delinquencies.
Prior Period Reserve Development.
The mortgage segment’s net favorable development was $42 million, or 15.4 points, for the 2026 third quarter, compared to $54 million, or 18.1 points, for the 2025 third quarter, and $141 million, or 16.8 points, for the nine months ended September 30, 2026, compared to $179 million, or 20.4 points, for the 2025 period. See note 6, “Reserve for Losses and Loss Adjustment Expenses,” to our consolidated financial statements for information about the mortgage segment’s prior year reserve development.
Underwriting Expenses.
2026 Third Quarter versus 2025 Period. The underwriting expense ratio for the mortgage segment was 18.6% in the 2026 third quarter, compared to 14.0% in the 2025 third quarter. The increase was primarily due to lower ceding and profit commissions. The 2026 third quarter ratio also reflected the impact of a lower level of net premiums earned.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
Nine Months Ended September 30, 2026 versus 2025 period. The underwriting expense ratio for the mortgage segment was 17.2% for the nine months ended September 30, 2026, compared to 15.1% for the 2025 period. The increase was primarily due to lower ceding and profit commissions and also reflected the impact of a lower level of net premiums earned.
Corporate
The Company’s corporate results include net investment income, net realized gains or losses (which include, but are not limited to, realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries), equity in net income or loss of investments accounted for using the equity method, other income or loss, corporate expenses, transaction costs and other, amortization of intangible assets, interest expense, net foreign exchange gains or losses, income taxes, income from operating affiliates and items related to our non-cumulative preferred shares.
Net Investment Income.
The components of net investment income were derived from the following sources:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Fixed maturities$409 $379 $1,179 $1,081 
Short-term investments27 25 77 75 
Equity securities (dividends)10 10 27 31 
Other (1)30 19 72 82 
Gross investment income476 433 1,355 1,269 
Investment expenses (2)(25)(25)(79)(78)
Net investment income$451 $408 $1,276 $1,191 
(1)    Amounts include dividends and other distributions on investment funds, term loan investments, funds held balances, cash balances and other items.
(2)        Investment expenses were approximately 0.22% of average invested assets for the 2026 third quarter, compared to 0.25% for the 2025 third quarter, and 0.25% for the nine months ended September 30, 2026, consistent with 0.27% for the 2025 period.
The higher level of net investment income for the 2026 periods primarily reflected growth in average invested assets, due in part to strong operating cash flows. Net cash flow from operating activities contributed $4.3 billion for the nine months ended September 30, 2026. The pre-tax investment income yield, calculated based on amortized cost and on an annualized basis, was 4.09% for the 2026 third quarter, compared to 4.07% for the 2025 third quarter, and 4.00% for the nine months ended September 30, 2026, compared to 4.16% for the 2025 period.
Corporate Expenses.
Corporate expenses were $5 million for the 2026 third quarter, compared to $28 million for the 2025 third quarter, and $48 million for the nine months ended September 30, 2026, compared to $107 million for the 2025 period. Such amounts primarily represent certain holding company costs necessary to support our worldwide operations and costs associated with operating as a publicly traded company. The decline in the 2026 periods primarily reflected the benefit of Bermuda qualified refundable tax credits.
Transaction Costs and Other.
Transaction costs and other for the 2026 third quarter was $17 million, compared to $21 million for the 2025 third quarter, and $67 million for the nine months ended September 30, 2026, compared to $49 million for the 2025 period. Amounts in both periods primarily includes direct costs related to the MCE Acquisition.
Other Income or Losses.
Other income for the 2026 third quarter was $4 million, compared to $22 million for the 2025 third quarter, and $29 million for the nine months ended September 30, 2026, compared to $38 million for the 2025 period. Amounts in both periods primarily reflect changes in the cash surrender value of our investment in corporate-owned life insurance.
Amortization of Intangible Assets.
Amortization of intangible assets for the 2026 third quarter was $30 million, compared to $49 million for the 2025 third quarter, and $90 million for the nine months ended September 30, 2026, compared to $146 million for the 2025 period. The decrease primarily related to lower amortization of intangible assets related to the MCE Acquisition.
Interest Expense.
Interest expense was $62 million for the 2026 third quarter, compared to $37 million for the 2025 third quarter, and $143 million for the nine months ended September 30, 2026, compared to $110 million for the 2025 period. Interest expense primarily reflects amounts related to our outstanding senior notes. The increase primarily resulted from the Company’s June 2026 capital raising activity. See note 11, “Commitments and Contingencies," to our consolidated financial statements for additional information.
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2026 THIRD QUARTER FORM 10-Q
Net Realized Gains or Losses.
Net realized losses for the 2026 third quarter were $99 million, compared to net realized gains of $210 million for the 2025 third quarter. Net realized losses were $203 million for the nine months ended September 30, 2026, compared to net realized gains of $442 million for the 2025 period. Amounts in both periods reflected sales of investments as well as net unrealized gains or losses related to financial market movements on the Company’s equity securities and investments accounted for under the fair value option method. Amounts in the 2026 period also include a litigation-related loss contingency recorded pursuant to ASC 450, while amounts in the 2025 periods include losses related to the sale of certain alternative investments accounted for under the equity method.
Currently, our portfolio is actively managed to maximize total return within certain guidelines. The effect of financial market movements on the investment portfolio will directly impact net realized gains or losses as the portfolio is adjusted and rebalanced. Net realized gains or losses from the sale of fixed maturities primarily results from our decisions to reduce credit exposure, to change duration targets, to rebalance our portfolios or due to relative value determinations.
Net realized gains or losses also include realized and unrealized changes in the fair value of equity securities and assets accounted for using the fair value option, realized and unrealized gains or losses on derivative instruments, changes in the allowance for credit losses on financial assets and gains or losses realized from the acquisition or disposition of subsidiaries See note 8, “Investment Information—Net Realized Gains (Losses)” and note 8, “Investment Information—Allowance for Expected Credit Losses,” to our consolidated financial statements for additional information.
Equity in Net Income or Losses of Investments Accounted for Using the Equity Method.
Equity in net income of investments accounted for using the equity method was $224 million in the 2026 third quarter, compared to $134 million for the 2025 third quarter, and $580 million for the nine months ended September 30, 2026, compared to $349 million for the 2025 period. Such investments are generally recorded on a one to three month lag based on the availability of reports from the investment funds. Investment funds accounted for using the equity method totaled $7.1 billion at September 30, 2026, compared to $6.5 billion at December 31, 2025. See note 8, “Investment Information—Investments Accounted For Using the Equity Method,” to our consolidated financial statements for additional information.
Net Foreign Exchange Gains or Losses.
Net foreign exchange gains for the 2026 third quarter were $18 million, compared to losses of $7 million for the 2025 third quarter. Net foreign exchange gains for the nine months ended September 30, 2026 were $49 million, compared to losses of $122 million for the 2025 period. Amounts in both periods were primarily unrealized and resulted from the effects of revaluing our net insurance liabilities required to be settled in foreign currencies at each balance sheet date.
Income Tax Expense.
Our income tax provision on income or loss before income taxes, including income or loss from operating affiliates, resulted in an expense of 15.1% for the 2026 third quarter, compared to an expense of 13.7% for the 2025 third quarter, and an expense of 12.4% for the nine months ended September 30, 2026, compared to an expense of 14.8% for the 2025 period. See note 14, “Income Taxes” to our consolidated financial statements for additional information.
Income or Losses from Operating Affiliates.
Income from operating affiliates for the 2026 third quarter was $33 million, compared to income of $62 million for the 2025 third quarter, and income of $115 million for the nine months ended September 30, 2026, compared to income of $119 million for the 2025 period. Such amounts primarily related to the Company’s investment in Somers Group Holdings Ltd. and Coface SA. See note 8, “Investment Information—Investments in Operating Affiliates,” to our consolidated financial statements for additional information.
CRITICAL ACCOUNTING POLICIES,
ESTIMATES AND RECENT ACCOUNTING PRONOUNCEMENTS
Critical accounting policies, estimates and recent accounting pronouncements are discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our 2025 Form 10-K, updated where applicable in the notes accompanying our consolidated financial statements, including note 1, “Basis of Presentation and Recent Accounting Pronouncements.”
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
FINANCIAL CONDITION
Investable Assets Held by Arch 
At September 30, 2026, approximately $29.7 billion, or 60.3%, of total investable assets held by Arch were internally managed, compared to $29.5 billion, or 62.2%, at December 31, 2025. See note 8, “Investment Information” to our consolidated financial statements for additional information.
The following table summarizes the duration and average credit quality of fixed income assets held by Arch:
September 30,
2026		December 31, 2025
Average effective fixed maturities duration (in years)3.25 3.34 
Average S&P/Moody’s credit ratings (1)AA-/Aa3AA-/Aa3
(1)Average credit ratings on our investment portfolio on securities with ratings assigned by S&P and Moody’s.
The following table provides the credit quality distribution of our fixed maturities. For individual fixed maturities, S&P ratings are used. In the absence of an S&P rating, ratings from Moody’s are used, followed by ratings from Fitch Ratings.
Estimated Fair Value% of
Total
September 30, 2026
U.S. government and gov’t agencies (1)$9,037 27.2 
AAA5,314 16.0 
AA2,718 8.2 
A6,544 19.7 
BBB6,763 20.3 
BB1,399 4.2 
B834 2.5 
Lower than B38 0.1 
Not rated636 1.9 
Total$33,283 100.0 
December 31, 2025
U.S. government and gov’t agencies (1)$9,561 28.5 
AAA5,667 16.9 
AA2,564 7.6 
A6,448 19.2 
BBB6,533 19.5 
BB1,330 4.0 
B734 2.2 
Lower than B35 0.1 
Not rated664 2.0 
Total$33,536 100.0 
(1)Includes U.S. government-sponsored agency residential mortgage-backed securities and agency commercial mortgage-backed securities.
The following table provides information on the severity of the unrealized loss position as a percentage of amortized cost for all fixed maturities which were in an unrealized loss position:
Severity of gross unrealized losses:Estimated Fair ValueGross
Unrealized
Losses		% of
Total Gross
Unrealized
Losses
September 30, 2026
0-10%$28,805 $(941)86.4 
10-20%755 (119)10.9 
20-30%69 (21)1.9 
Greater than 30%13 (8)0.7 
Total$29,642 $(1,089)100.0 
December 31, 2025
0-10%$11,702 $(202)69.9 
10-20%556 (80)27.7 
20-30%20 (6)2.1 
Greater than 30%1 (1)0.3 
Total$12,279 $(289)100.0 
The following table summarizes our top ten exposures to fixed income corporate issuers by fair value at September 30, 2026, excluding guaranteed amounts and covered bonds:
Estimated Fair ValueCredit
Rating (1)
Morgan Stanley$444 A/A1
Citigroup Inc.302 A-/A2
The Goldman Sachs Group, Inc.274 BBB+/A2
Bank of America Corporation237 A-/A1
Amazon.com, Inc.234 AA/A1
JPMorgan Chase & Co.231 A/A1
The Toronto-Dominion Bank194 A-/A2
UBS Group AG176 A/A1
Alphabet Inc.158 AA+/Aa2
Wells Fargo & Company157 A-/A1
Total$2,407 
(1)Average credit ratings as assigned by S&P and Moody’s, respectively.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
The following table provides information on our structured securities, which includes residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”) and asset-backed securities (“ABS”):
AgenciesInvestment GradeBelow Investment GradeTotal
September 30, 2026
RMBS$1,798 $695 $25 $2,518 
CMBS6 1,381 118 1,505 
ABS— 3,474 261 3,735 
Total$1,804 $5,550 $404 $7,758 
December 31, 2025
RMBS$2,105 $600 $— $2,705 
CMBS6 1,129 77 1,212 
ABS— 3,368 206 3,574 
Total$2,111 $5,097 $283 $7,491 
The following table summarizes our equity securities, which include investments in exchange traded funds:
September 30,
2026		December 31,
2025
Equities (1)$1,645 $1,296 
Exchange traded funds
Fixed income (2)544 316 
Equity and other (3)211 257 
Total$2,400 $1,869 
(1)Primarily in technology, financial, communications, consumer non-cyclical and industrial sectors at September 30, 2026.
(2)Primarily in government, structured and corporate exposures at September 30, 2026.
(3)Primarily in technology, financials, communications, healthcare and consumer cyclical sectors at September 30, 2026.

For details on our other investments and other investable assets, see note 8, “Investment Information—Other Investments” to our consolidated financial statements.
For details on our investments accounted for using the equity method, see note 8, “Investment Information—Investments Accounted For Using the Equity Method,” to our consolidated financial statements.
Our investment strategy allows for the use of derivative instruments. We utilize various derivative instruments such as futures contracts to enhance investment performance, replicate investment positions or manage market exposures and duration risk that would be allowed under our investment guidelines if implemented in other ways. See note 10, “Derivative Instruments,” to our consolidated financial statements for additional disclosures related to derivatives.
Accounting guidance regarding fair value measurements addresses how companies should measure fair value when they are required to use a fair value measure for recognition or disclosure purposes under GAAP and provides a common definition of fair value to be used throughout GAAP. See note 9, “Fair Value,” to our consolidated financial statements for a summary of our financial assets and liabilities measured at fair value, segregated by level in the fair value hierarchy.
Reinsurance
The effects of reinsurance on written and earned premiums and losses and loss adjustment expenses (“LAE”) with unaffiliated reinsurers were as follows:
Three Months EndedNine Months Ended
September 30,September 30,
2026202520262025
Premiums written:
Direct$2,922 $2,516 $8,270 $7,689 
Assumed2,469 2,894 9,672 10,380 
Ceded(1,546)(1,446)(5,700)(5,242)
Net$3,845 $3,964 $12,242 $12,827 
Premiums earned:
Direct$2,655 $2,576 $7,794 $7,596 
Assumed3,016 3,300 8,981 9,859 
Ceded(1,657)(1,591)(4,790)(4,645)
Net$4,014 $4,285 $11,985 $12,810 
Losses and LAE:
Direct$1,680 $1,480 $4,755 $4,221 
Assumed1,536 1,500 4,314 5,695 
Ceded(1,010)(780)(2,578)(2,826)
Net$2,206 $2,200 $6,491 $7,090 
See note 7, “Allowance for Expected Credit Losses,” to our consolidated financial statements for information about our reinsurance recoverables and related allowance for credit losses.
Bellemeade Re
We have entered into aggregate excess of loss mortgage reinsurance agreements with various special purpose reinsurance companies domiciled in Bermuda (the “Bellemeade Agreements”). For the respective coverage periods, we will retain the first layer of the respective aggregate losses and the special purpose reinsurance companies will provide second layer coverage up to the outstanding coverage amount. We will then retain losses in excess of the outstanding coverage limit. The aggregate excess of loss reinsurance coverage generally decreases over a ten-year period as the underlying covered mortgages amortize, unless provisional call options embedded within certain of the Bellemeade Agreements are executed or if pre-defined delinquency triggering events occur.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
The following table summarizes the respective coverages and retentions at September 30, 2026:
Bellemeade Entities
(Issue Date)		Initial Coverage at IssuanceCurrent CoverageRemaining Retention, Net
2021-3 Ltd. (1)$639 $26 $128 
2022-1 Ltd. (2)317 52 131 
2022-2 Ltd. (3)327 121 176 
2023-1 Ltd. (4)233 142 148 
2024-1 Ltd. (5)204 74 156 
2025-1 Ltd. (6)249 204 159 
Total$1,969 $619 $898 
(1) Issued in September 2021, covering in-force policies issued between April 1, 2021 and June 30, 2021. $508 million was directly funded by Bellemeade Re 2021-3 Ltd. via insurance-linked notes, with an additional $131 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
(2)    Issued in January 2022, covering in-force policies issued between July 1, 2021 and November 30, 2021. $284 million was directly funded by Bellemeade Re 2022-1 Ltd. via insurance-linked notes, with an additional $33 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
(3) Issued in September 2022, covering in-force policies issued between November 1, 2021 and June 30, 2022. $201 million was directly funded by Bellemeade Re 2022-2 Ltd. via insurance-linked notes, with an additional $126 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
(4) Issued in October 2023, covering in-force policies issued between January 1, 2023 and September 30, 2023. $186 million was directly funded by Bellemeade Re 2023-1 Ltd. via insurance-linked notes, with an additional $47 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
(5)    Issued in August 2024, covering in-force policies issued between September 1, 2023 and July 31, 2024. $163 million was directly funded by Bellemeade Re 2024-1 Ltd. via insurance-linked notes, with an additional $41 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
(6)    Issued in November 2025, covering in-force policies issued between July 1, 2024 and September 30, 2025. $199 million was directly funded by Bellemeade Re 2025-1 Ltd. via insurance-linked notes, with an additional $50 million capacity provided directly to Arch MI U.S. by a separate panel of reinsurers.
Reserve for Losses and Loss Adjustment Expenses 
We establish reserve for losses and loss adjustment expenses (“Loss Reserves”) which represent estimates involving actuarial and statistical projections, at a given point in time, of our expectations of the ultimate settlement and administration costs of losses incurred. Estimating Loss Reserves is inherently difficult. We utilize actuarial models as well as available historical insurance industry loss ratio experience and loss development patterns to assist in the establishment of Loss Reserves. Actual losses and loss adjustment expenses paid will deviate, perhaps substantially, from the reserve estimates reflected in our financial statements.
At September 30, 2026 and December 31, 2025, our Loss Reserves, net of unpaid losses and loss adjustment expenses recoverable, by type and by operating segment were as follows:
September 30,
2026		December 31,
2025
Insurance segment:
Case reserves$3,605 $3,489 
IBNR reserves9,701 9,251 
Total net reserves13,306 12,740 
Reinsurance segment:
Case reserves3,055 2,929 
Additional case reserves932 1,034 
IBNR reserves8,128 7,349 
Total net reserves12,115 11,312 
Mortgage segment:
Case reserves348 324 
IBNR reserves116 117 
Total net reserves464 441 
Total:
Case reserves7,008 6,742 
Additional case reserves932 1,034 
IBNR reserves17,945 16,717 
Total net reserves$25,885 $24,493 
At September 30, 2026 and December 31, 2025, the insurance segment’s Loss Reserves by major line of business, net of unpaid losses and loss adjustment expenses recoverable, were as follows:
September 30,
2026		December 31,
2025
Insurance segment:
Third party occurrence business$4,974 $4,610 
Multi-line and other specialty4,276 4,345 
Third party claims-made business2,982 2,861 
Property, energy, marine and aviation1,074 924 
Total net reserves$13,306 $12,740 
At September 30, 2026 and December 31, 2025, the reinsurance segment’s Loss Reserves by major line of business, net of unpaid losses and loss adjustment expenses recoverable, were as follows:
September 30,
2026		December 31,
2025
Reinsurance segment:
Casualty$4,321 $3,823 
Specialty3,850 3,658 
Property excluding property catastrophe2,252 2,107 
Property catastrophe922 953 
Marine and aviation557 582 
Other213 189 
Total net reserves$12,115 $11,312 
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
At September 30, 2026 and December 31, 2025, the mortgage segment’s Loss Reserves by major line of business, net of unpaid losses and loss adjustment expenses recoverable, were as follows:
September 30,
2026		December 31,
2025
Mortgage segment:
U.S. primary mortgage insurance$346 $321 
U.S. credit risk transfer (CRT) and other55 64 
International mortgage insurance/
reinsurance		63 56 
Total net reserves$464 $441 
Mortgage Operations Supplemental Information
The mortgage segment’s insurance in force (“IIF”) and risk in force (“RIF”) were as follows at September 30, 2026 and December 31, 2025:
September 30, 2026December 31, 2025
Amount%Amount%
Insurance In Force (IIF) (1):
U.S. primary mortgage insurance$285,488 59.8 $286,318 59.1 
U.S. credit risk transfer (CRT) and other 125,322 26.3 132,205 27.3 
International mortgage insurance/reinsurance 66,417 13.9 66,084 13.6 
Total$477,227 100.0 $484,607 100.0 
Risk In Force (RIF) (2):
U.S. primary mortgage insurance$73,611 83.4 $74,679 85.0 
U.S. credit risk transfer (CRT) and other5,038 5.7 5,358 6.1 
International mortgage insurance/reinsurance9,648 10.9 7,864 8.9 
Total$88,297 100.0 $87,901 100.0 
(1)Represents the aggregate dollar amount of each insured mortgage loan’s current principal balance. Such amounts are shown before external reinsurance.
(2)The aggregate dollar amount of each insured mortgage loan’s current principal balance multiplied by the insurance coverage percentage specified in the policy for insurance policies issued and after contract limits and/or loss ratio caps for risk-sharing or reinsurance. Such amounts are shown before external reinsurance.

The IIF and RIF for our U.S. primary mortgage insurance business by policy year were as follows at September 30, 2026:
IIFRIFDelinquency
Amount%Amount%Rate (1)
Policy year:
2016 and prior$17,686 6.2 $4,502 6.1 4.75 %
20172,664 0.9 677 0.9 5.27 %
20184,671 1.6 1,217 1.7 4.93 %
20198,262 2.9 2,182 3.0 3.33 %
202023,303 8.2 6,483 8.8 2.20 %
202142,375 14.8 11,737 15.9 2.07 %
202243,666 15.3 11,834 16.1 2.15 %
202326,464 9.3 6,841 9.3 2.41 %
202433,873 11.9 8,511 11.6 1.73 %
202540,587 14.2 9,856 13.4 0.62 %
202641,937 14.7 9,771 13.3 0.11 %
Total$285,488 100.0 $73,611 100.0 2.20 %
(1)Represents the ending percentage of loans in default.
The IIF and RIF for our U.S. primary mortgage insurance business by policy year were as follows at December 31, 2025:
IIFRIFDelinquency
Amount%Amount%Rate (1)
Policy year:
2016 and prior$19,384 6.8 $4,923 6.6 5.08 %
20174,250 1.5 1,127 1.5 3.87 %
20185,673 2.0 1,479 2.0 4.48 %
201910,553 3.7 2,770 3.7 3.08 %
202030,968 10.8 8,487 11.4 1.85 %
202150,141 17.5 13,767 18.4 1.88 %
202249,492 17.3 13,236 17.7 1.87 %
202331,049 10.8 8,006 10.7 1.93 %
202439,306 13.7 9,840 13.2 1.17 %
202545,502 15.9 11,044 14.8 0.20 %
Total$286,318 100.0 $74,679 100.0 2.17 %
(1)Represents the ending percentage of loans in default.
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2026 THIRD QUARTER FORM 10-Q
The following tables provide supplemental disclosures on risk in force for our U.S. primary mortgage insurance business at September 30, 2026 and December 31, 2025:
September 30, 2026December 31, 2025
Amount%Amount%
Credit quality:
>=740$48,273 65.6 $47,757 63.9 
680-73921,911 29.8 23,271 31.2 
620-6793,139 4.3 3,340 4.5 
<620288 0.4 311 0.4 
Total$73,611 100.0 $74,679 100.0 
Weighted average credit score751 749 
Loan-to-value (LTV):
95.01% and above$7,474 10.2 $7,314 9.8 
90.01% to 95.00%43,916 59.7 44,494 59.6 
85.01% to 90.00%19,194 26.1 20,195 27.0 
85.00% and below3,027 4.1 2,676 3.6 
Total$73,611 100.0 $74,679 100.0 
Weighted average LTV93.2 %93.2 %
Total RIF, net of external reinsurance$61,548 $60,259 
September 30, 2026December 31, 2025
Amount%Amount%
Total RIF by State:
California$5,958 8.1 $5,901 7.9 
Texas5,382 7.3 5,382 7.2 
North Carolina3,241 4.4 3,343 4.5 
Illinois3,090 4.2 3,042 4.1 
Minnesota3,080 4.2 3,129 4.2 
Georgia2,865 3.9 3,005 4.0 
Michigan2,764 3.8 2,816 3.8 
Florida2,707 3.7 2,672 3.6 
Ohio2,655 3.6 2,666 3.6 
Massachusetts2,579 3.5 2,780 3.7 
Other39,290 53.4 39,943 53.5 
Total$73,611 100.0 $74,679 100.0 
The following table provides supplemental disclosures for our U.S. primary mortgage insurance business related to insured loans and loss metrics:
(U.S. Dollars in thousands, except policy, loan and claim count)Nine Months Ended
September 30,
20262025
Roll-forward of insured loans in default:
Beginning delinquent number of loans22,985 22,982 
New notices
35,586 34,553 
Cures
(34,781)(34,720)
Paid claims
(1,182)(994)
Ending delinquent number of loans (1)22,608 21,821 
Ending number of policies in force (1)1,026,816 1,067,147 
Ending percentage of loans in default (1)2.20 %2.04 %
Losses:
Number of claims paid1,182 994 
Total paid claims$53,411 $37,587 
Average per claim$45.2 $37.8 
Severity (2)78.9 %75.1 %
Average case reserve per default (1)$16.4 $16.1 
(1)Includes first lien primary and pool policies.
(2)Represents total direct first lien paid claims divided by RIF of loans for which claims were paid, excluding paid claim settlements.
The risk to capital ratio, which represents total current (non-delinquent) risk in force, net of reinsurance, divided by total statutory capital, for Arch MI U.S. was approximately 8.4 to 1 at September 30, 2026, compared to 8.2 to 1 at December 31, 2025.
Shareholders’ Equity and Book Value per Share
The following table presents the calculation of book value per share:
September 30,
2026		December 31,
2025
Total shareholders’ equity available to Arch$22,992 $24,206 
Less preferred shareholders’ equity830 830 
Common shareholders’ equity available to Arch$22,162 $23,376 
Common shares and common share equivalents outstanding, net of treasury shares (1)326.4 359.0 
Book value per share$67.90 $65.11 
(1)Excludes the effects of 8.1 million and 10.2 million stock options and 0.4 million and 0.3 million restricted and performance share units outstanding at September 30, 2026 and December 31, 2025, respectively.
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LIQUIDITY
Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations.
Arch Capital is a holding company whose assets primarily consist of shares in its subsidiaries. Generally, Arch Capital depends on its available cash resources, liquid investments and dividends or other distributions from its subsidiaries to make payments, including the payment of debt service obligations and operating expenses it may incur and any dividends or liquidation amounts with respect to our preferred and common shares.
For the nine months ended September 30, 2026, Arch Capital received dividends of $3.5 billion from Arch Reinsurance Ltd. (“Arch Re Bermuda”), our Bermuda based reinsurer and insurer, which can pay approximately $2.9 billion to Arch Capital during the remainder of 2026 without providing an affidavit to the Bermuda Monetary Authority.
We expect that our liquidity needs, including our anticipated (re)insurance obligations and operating and capital expenditure needs, for the next 12 months and for the foreseeable future thereafter, will be met by funds generated from underwriting activities and investment income, as well as by our balance of cash, short-term investments, proceeds on the sale or maturity of our investments, and our credit facilities.
Cash Flows
The following table summarizes our cash flows from operating, investing and financing activities:
Nine Months Ended
September 30,
20262025
Total cash provided by (used for):
Operating activities$4,269 $4,768 
Investing activities(2,525)(3,619)
Financing activities(1,842)(1,112)
Effects of exchange rate changes on foreign currency cash and restricted cash8 57 
Increase (decrease) in cash and restricted cash$(90)$94 
Cash provided by operating activities for the nine months ended September 30, 2026 was lower than in the 2025 period. Activity for the nine months ended September 30, 2026 primarily reflected a lower level of premium collected than in the 2025 period.
Cash used for investing activities for the nine months ended September 30, 2026 was lower than in the 2025 period. Activity for the nine months ended September 30, 2026 reflected higher sales, redemptions and maturities of fixed maturities investments compared to the 2025 period.
Cash used for financing activities for the nine months ended September 30, 2026 was higher than in the 2025 period and reflected the issuance of $2.0 billion of senior notes, partially offset by tender offer activity of $398 million. In addition, we repurchased approximately $3.4 billion of our common shares in the 2026 period, compared to $1.1 billion in the 2025 period.
CAPITAL RESOURCES
The following table provides an analysis of our capital structure:
September 30,
2026		December 31,
2025
Senior notes$4,286 $2,729 
Shareholders’ equity available to Arch:
Series F non-cumulative preferred shares$330 $330 
Series G non-cumulative preferred shares500 500 
Common shareholders’ equity22,162 23,376 
Total$22,992 $24,206 
Total capital available to Arch$27,278 $26,935 
Debt to total capital (%)15.7 10.1 
Preferred to total capital (%)3.0 3.1 
Debt and preferred to total capital (%)18.8 13.2 
On June 9, 2026, Arch Capital completed a public offering of $2.0 billion of senior notes, consisting of $600 million of 5.250% senior notes due in 2036 and $1.4 billion of 5.950% senior notes due in 2056. Arch Capital used a portion of the net proceeds to pay the tender price for the cash tender offers described below and expects to use the remaining net proceeds from this offering to redeem, repurchase, repay or otherwise retire its 4.011% senior notes due in 2026 and the balance for general corporate purposes. On June 16, 2026, the Company completed the cash tender offers for certain outstanding senior notes, with Arch Capital Group (U.S.) Inc. (“Arch-U.S.”) repurchasing $218.7 million of its 5.144% senior notes due in 2043, and Arch Capital Finance LLC (“Arch Finance”) repurchasing $199.1 million of its 5.031% senior notes due in 2046. See note 11, “Commitments and Contingencies," to our consolidated financial statements for additional information.
Arch MI U.S. is required to maintain compliance with the GSEs requirements, known as the Private Mortgage Insurer Eligibility Requirements or “PMIERs.” The financial requirements require an eligible mortgage insurer’s available assets, which generally include only the most liquid assets of an insurer, to meet or exceed “minimum required assets” as of each quarter end. Minimum required assets are calculated from PMIERs tables with several risk dimensions (including origination year, original loan-to-value and original credit score of performing loans, and the delinquency status of non-performing loans) and are subject
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to a minimum amount. Arch MI U.S. satisfied the PMIERs’ financial requirements with an estimated PMIERs sufficiency ratio of 169% at September 30, 2026, compared to 179% at December 31, 2025. On August 21, 2024, Fannie Mae and Freddie Mac each updated their PMIERs to incorporate new deductions to available assets for investment risk. This update became effective on March 31, 2025 and the impact was phased in as of September 30, 2026.
As part of our capital management program, we may seek to raise additional capital or may seek to return capital to our shareholders through share repurchases, cash dividends or other methods (or a combination of such methods). We may also seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise. Any such determination will be at the discretion of the Board and will be dependent upon our profits, financial requirements and other factors, including legal restrictions, rating agency requirements, prevailing market conditions and such other factors as our Board deems relevant. The amounts involved may be material.
Arch Capital, through its subsidiaries, provides financial support to certain of its insurance subsidiaries and affiliates, through certain reinsurance arrangements beneficial to the ratings of such subsidiaries. Historically, our insurance, reinsurance and mortgage insurance subsidiaries have entered into separate reinsurance arrangements with Arch Re Bermuda covering individual lines of business.
GUARANTOR INFORMATION
The below table provides a description of our senior notes payable at September 30, 2026:
Interest
Principal
Carrying
Issuer/Due
(Fixed)
Amount
Amount
Arch Capital:
May 1, 2034
7.350 %$300 $298 
June 15, 20365.250 %600592
June 30, 2050
3.635 %1,000990
June 15, 20565.950 %1,4001,379
Arch-U.S.:
Nov. 1, 2043 (1)
5.144 %281279
Arch Finance:
Dec. 15, 2026 (1)
4.011 %500500
Dec. 15, 2046 (1)
5.031 %251248
Total
$4,332 $4,286 
(1)Fully and unconditionally guaranteed by Arch Capital.
Our senior notes were issued by Arch Capital, Arch-U.S. and Arch Finance. Arch-U.S. is a wholly-owned subsidiary of Arch Capital and Arch Finance is a wholly-owned finance subsidiary of Arch-U.S. Our 2034 senior notes, 2036 senior notes, 2050 senior notes and 2056 senior notes issued by Arch Capital are unsecured and unsubordinated obligations of Arch Capital and ranked equally with all of its existing and future unsecured and unsubordinated indebtedness. The 2043 senior notes issued by Arch-U.S. are unsecured and unsubordinated obligations of Arch-U.S. and Arch Capital and rank equally and ratably with the other unsecured and unsubordinated indebtedness of Arch-U.S. and Arch Capital. The 2026 senior notes and 2046 senior notes issued by Arch Finance are unsecured and unsubordinated obligations of Arch Finance and Arch Capital and rank equally and ratably with the other unsecured and unsubordinated indebtedness of Arch Finance and Arch Capital.
Arch-U.S. and Arch Finance depend on their available cash resources, liquid investments and dividends or other distributions from their subsidiaries or affiliates to make payments, including the payment of debt service obligations and operating expenses they may incur.
The following tables present condensed financial information for Arch Capital (parent guarantor) and Arch-U.S. (subsidiary issuer):
September 30, 2026December 31, 2025
Arch CapitalArch-U.S.Arch CapitalArch-U.S.
Assets
Total investments$123 $665 $40 $442 
Cash17 3 13 4 
Investment in operating affiliates2 — 3 — 
Due from subsidiaries and affiliates14 19 16 14 
Other assets280 138 194 129 
Total assets$436 $825 $266 $589 
Liabilities
Senior notes3,259 279 1,288 496 
Due to subsidiaries and affiliates4 1,023 6 993 
Other liabilities100 64 41 58 
Total liabilities$3,363 $1,366 $1,335 $1,547 
Non-cumulative preferred shares$830 — $830 — 
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Nine Months Ended
September 30, 2026
Arch CapitalArch-U.S.
Revenues
Net investment income$2 $21 
Net realized gains (losses)— 2 
Equity in net income (loss) of investments accounted for using the equity method— (5)
Total revenues2 18 
Expenses
Corporate expenses52 3 
Interest expense80 16 
Interest expense (intercompany)— 43 
Total expenses132 62 
Income (loss) before income taxes and income (loss) from operating affiliates(130)(44)
Income tax (expense) benefit31 1 
Income (loss) before income (loss) from operating affiliates(99)(43)
Income (loss) from operating affiliates(1)— 
Net income available to Arch(100)(43)
Preferred dividends(30)— 
Net income (loss) available to Arch common shareholders$(130)$(43)
CATASTROPHIC AND SEVERE ECONOMIC EVENTS
We have large aggregate exposures to natural and man-made catastrophic events, pandemic events and severe economic events. Natural catastrophes can be caused by various events, including hurricanes, floods, windstorms, earthquakes, hailstorms, tornadoes, explosions, severe winter weather, fires, droughts and other natural disasters. Man-made catastrophic events may include acts of war, acts of terrorism and political instability. Catastrophes can also cause losses in non-property business such as mortgage insurance, workers’ compensation or general liability. In addition to the nature of property business, we believe that economic and geographic trends affecting insured property, including inflation, property value appreciation and geographic concentration, tend to generally increase the size of losses from catastrophic events over time.
Our models employ both proprietary and vendor-based systems and include cross-line correlations for property, marine, offshore energy, aviation, workers compensation and personal accident. We seek to limit the probable maximum pre-tax loss to a specific level for severe catastrophic events. Currently, we seek to limit our 1-in-250 year return period net probable maximum loss from a severe catastrophic event in any geographic zone to approximately 25% of tangible shareholders’ equity available to Arch (total shareholders’ equity available to Arch less goodwill and intangible assets). We reserve the right to change this threshold at any time.
Based on in-force exposure estimated as of October 1, 2026, our modeled peak zone catastrophe exposure was a windstorm affecting the Florida Tri-County regions, with a net probable maximum pre-tax loss of $1.9 billion, or 8.6% of tangible shareholders’ equity available to Arch, followed by windstorms affecting the Northeastern U.S. and the Gulf of Mexico regions with net probable maximum pre-tax losses of $1.5 billion and $1.4 billion, respectively. Our exposures to other perils, such as U.S. earthquake and international events, were less than the exposures arising from U.S. windstorms and hurricanes. As of October 1, 2026, our modeled peak zone earthquake exposure (San Francisco earthquake) represented approximately 48% of our peak zone catastrophe exposure, and our modeled peak zone international exposure (Australia earthquake) was substantially less than both our peak zone windstorm and earthquake exposures.
We also have significant exposure to losses due to mortgage defaults resulting from severe economic events in the future. For our U.S. and Australian mortgage insurance business, we have developed a proprietary risk model (“Realistic Disaster Scenario” or “RDS”) that simulates the maximum loss resulting from a severe economic downturn impacting the housing market. The RDS models the collective impact of adverse conditions for key economic indicators, the most significant of which is a decline in home prices. The RDS model projects paths of future home prices, unemployment rates, income levels and interest rates and assumes correlation across states and geographic regions. The resulting future performance of our in-force portfolio is then estimated under the economic stress scenario, reflecting loan and borrower information.
Currently, we seek to limit our modeled RDS loss from a severe economic event to approximately 25% of tangible shareholders’ equity available to Arch. We reserve the right to change this threshold at any time. Based on in-force exposure estimated as of October 1, 2026, our modeled RDS loss was approximately $1.2 billion, or 5.4% of tangible shareholders’ equity available to Arch.
Net probable maximum loss estimates are net of expected reinsurance recoveries, before income tax and before excess reinsurance reinstatement premiums. RDS loss estimates are net of expected reinsurance recoveries and before income tax. Catastrophe loss estimates are reflective of the zone indicated and not the entire portfolio. Since hurricanes and windstorms can affect more than one zone and make multiple landfalls, our catastrophe loss estimates include clash estimates from other zones. Our catastrophe loss estimates and RDS loss estimates do not represent our maximum exposures and it is highly likely that our actual incurred losses would vary materially from the modeled estimates. There can be no assurances that we will not suffer pre-tax losses greater than 25% of our tangible
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shareholders’ equity from one or more catastrophic events or severe economic events due to several factors. These factors include the inherent uncertainties in estimating the frequency and severity of such events and the margin of error in making such determinations resulting from potential inaccuracies and inadequacies in the data provided by clients and brokers, the modeling techniques and the application of such techniques or as a result of a decision to change the percentage of shareholders' equity exposed to a single catastrophic event or severe economic event. In addition, actual losses may increase if our reinsurers fail to meet their obligations to us or the reinsurance protections purchased by us are exhausted or are otherwise unavailable. See “Risk Factors—Risks Relating to Our Industry” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Catastrophic Events and Severe Economic Events” in our 2025 Form 10-K.
MARKET SENSITIVE INSTRUMENTS AND RISK MANAGEMENT
In accordance with the SEC’s Financial Reporting Release No. 48, we performed a sensitivity analysis to determine the effects that market risk exposures could have on the future earnings, fair values or cash flows of our financial instruments as of September 30, 2026. Market risk represents the risk of changes in the fair value of a financial instrument and is comprised of several components, including liquidity, basis and price risks.
An analysis of material changes in market risk exposures at September 30, 2026 that affect the quantitative and qualitative disclosures presented in our 2025 Form 10-K (see section captioned “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Market Sensitive Instruments and Risk Management”) were as follows: 
Investment Market Risk
Fixed Income Securities. We invest in interest rate sensitive securities, which are primarily debt securities. We consider the effect of interest rate movements on the fair value of our fixed maturities, short-term investments and certain of our other investments, equity securities and investments accounted for using the equity method which invest in fixed income securities (collectively, “Fixed Income Securities”) and the corresponding change in unrealized appreciation. As interest rates rise, the fair value of our Fixed Income Securities falls, and the converse is also true. Based on historical observations, there is a low probability that all interest rate yield curves would shift in the same direction at the same time. Furthermore, at times interest rate movements in certain credit sectors exhibit a much lower correlation to changes in U.S. Treasury yields. Accordingly, the actual effect of interest rate movements may differ
materially from the amounts set forth in the following tables.
The following table summarizes the effect that an immediate, parallel shift in the interest rate yield curve would have had on our Fixed Income Securities:
(U.S. dollars in 
billions)		Interest Rate Shift in Basis Points
-100-50—+50+100
September 30, 2026
Total fair value$47.1 $46.4 $45.8 $45.1 $44.6 
Change from base2.8 %1.4 %(1.4)%(2.7)%
Change in unrealized value$1.3 $0.6 $(0.6)$(1.2)
December 31, 2025
Total fair value$45.8 $45.2 $44.6 $44.0 $43.3 
Change from base2.8 %1.4 %(1.4)%(2.8)%
Change in unrealized value$1.2 $0.6 $(0.6)$(1.2)
In addition, we consider the effect of credit spread movements on the market value of our Fixed Income Securities and the corresponding change in unrealized value. As credit spreads widen, the fair value of our Fixed Income Securities falls, and the converse is also true. In periods where the spreads on our Fixed Income Securities are much higher than their historical average due to short-term market dislocations, a parallel shift in credit spread levels would result in a much more pronounced change in unrealized value.
The following table summarizes the effect that an immediate, parallel shift in credit spreads in a static interest rate environment would have had on our Fixed Income Securities:
(U.S. dollars in 
billions)		Credit Spread Shift in Percentage Points
-100-50—+50+100
September 30, 2026
Total fair value$47.0 $46.4 $45.8 $45.2 $44.6 
Change from base2.6 %1.3 %(1.3)%(2.6)%
Change in unrealized value$1.2 $0.6 $(0.6)$(1.2)
December 31, 2025
Total fair value$45.8 $45.2 $44.6 $44.0 $43.3 
Change from base2.8 %1.4 %(1.4)%(2.8)%
Change in unrealized value$1.2 $0.6 $(0.6)$(1.2)
Another method that attempts to measure portfolio risk is Value-at-Risk (“VaR”). VaR measures the worst expected loss under normal market conditions over a specific time interval at a given confidence level. The 1-year 95th percentile parametric VaR reported herein estimates that 95% of the time, the portfolio loss in a one-year horizon would be less than or equal to the calculated number, stated as a percentage of the measured portfolio’s initial value. The VaR is a variance-covariance based estimate, based on linear
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sensitivities of a portfolio to a broad set of systematic market risk factors and idiosyncratic risk factors mapped to the portfolio exposures. The relationships between the risk factors are estimated using historical data, and the most recent data points are generally given more weight. As of September 30, 2026, our portfolio’s 95th percentile VaR was estimated to be 6.3%, compared to an estimated 6.5% at December 31, 2025. In periods where the volatility of the risk factors mapped to our portfolio’s exposures is higher due to market conditions, the resulting VaR is higher than in other periods.
Equity Securities. At September 30, 2026 and December 31, 2025, the fair value of our investments in equity securities and certain investments accounted for using the equity method with underlying equity strategies totaled $2.3 billion and $1.8 billion, respectively. These investments are exposed to price risk, which is the potential loss arising from decreases in fair value. An immediate hypothetical 10% decline in the value of each position would reduce the fair value of such investments by approximately $227 million and $178 million at September 30, 2026 and December 31, 2025, respectively, and would have decreased book value per share by approximately $0.69 and $0.50, respectively. An immediate hypothetical 10% increase in the value of each position would increase the fair value of such investments by approximately $227 million and $178 million at September 30, 2026 and December 31, 2025, respectively, and would have increased book value per share by approximately $0.69 and $0.50, respectively.
Investment-Related Derivatives. At September 30, 2026, the notional value of all derivative instruments (excluding foreign currency forward contracts which are included in the foreign currency exchange risk analysis below) was $8.4 billion, compared to $8.0 billion at December 31, 2025. If the underlying exposure of each investment-related derivative held at September 30, 2026 depreciated by 100 basis points, it would have resulted in a reduction in net income of approximately $84 million, and a decrease in book value per share of approximately $0.26 per share, compared to $80 million and $0.22 per share, respectively, on investment-related derivatives held at December 31, 2025. If the underlying exposure of each investment-related derivative held at September 30, 2026 appreciated by 100 basis points, it would have resulted in an increase in net income of approximately $84 million, and an increase in book value per share of approximately $0.26 per share, compared to $80 million and $0.22 per share, respectively, on investment-related derivatives held at December 31, 2025. See note 10, “Derivative Instruments,” to our consolidated financial statements for additional disclosures concerning derivatives.
For further discussion on investment activity, please refer to “Financial Condition—Investable Assets.”
Foreign Currency Exchange Risk
Foreign currency rate risk is the potential change in value, income and cash flow arising from adverse changes in foreign currency exchange rates. Through our subsidiaries and branches located in various foreign countries, we conduct our insurance and reinsurance operations in a variety of local currencies other than the U.S. Dollar. We generally hold investments in foreign currencies which are intended to mitigate our exposure to foreign currency fluctuations in our net insurance liabilities. We may also utilize foreign currency forward contracts and currency options as part of our investment strategy. See note 10, “Derivative Instruments,” to our consolidated financial statements for additional information.
The following table provides a summary of our net foreign currency exchange exposures, as well as foreign currency derivatives in place to manage these exposures:
September 30,
2026		December 31,
2025
Net assets (liabilities), denominated in foreign currencies, excluding shareholders’ equity and derivatives$(817)$(498)
Shareholders’ equity denominated in foreign currencies (1)1,179 1,220 
Net foreign currency forward contracts outstanding (2)1,188 478 
Net exposures denominated in foreign currencies$1,550 $1,200 
Pre-tax impact of a hypothetical 10% appreciation of the U.S. Dollar against foreign currencies:
Shareholders’ equity$(155)$(120)
Book value per share$(0.47)$(0.33)
Pre-tax impact of a hypothetical 10% decline of the U.S. Dollar against foreign currencies:
Shareholders’ equity$155 $120 
Book value per share$0.47 $0.33 
(1)    Represents capital contributions held in the foreign currencies of our operating units.
(2)    Represents the net notional value of outstanding foreign currency forward contracts.
Although we generally attempt to match the currency of our projected liabilities with investments in the same currencies, from time to time we may elect to over or underweight one or more currencies, which could increase our exposure to foreign currency fluctuations and increase the volatility of our shareholders’ equity. Historical observations indicate a low probability that all foreign currency exchange rates would shift against the U.S. Dollar in the same direction and at the same time and, accordingly, the actual effect of foreign currency rate movements may differ materially from the amounts set forth above. For further discussion on foreign exchange activity, please refer to “Results of Operations.”
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2026 THIRD QUARTER FORM 10-Q
Effects of Inflation
General economic inflation has increased in recent quarters and may continue to remain at elevated levels for an extended period of time. The potential also exists, after a catastrophe loss or pandemic events, for the development of inflationary pressures in a local economy. This risk may be heightened from time to time by geopolitical tensions, global supply chain disruptions, tariffs, and other contributing factors. This may have a material effect on the adequacy of our reserves for losses and loss adjustment expenses, especially in longer-tailed lines of business, and on the market value of our investment portfolio through rising interest rates. The anticipated effects of inflation are considered in our pricing models, reserving processes and exposure management, across all lines of business and types of loss including natural catastrophe events. The actual effects of inflation on our results cannot be accurately known until claims are ultimately settled and will vary by the specific type of inflation affecting each line of business.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Reference is made to the information appearing above under the subheading “Market Sensitive Instruments and Risk Management” under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which information is hereby incorporated by reference.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
In connection with the filing of this Form 10-Q, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the Company’s disclosure controls and procedures, as of the end of the period covered by this report, for the purposes set forth in the applicable rules under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that evaluation and subject to the below, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report. Disclosure controls and procedures are the controls and other procedures designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There have been no changes in internal control over financial reporting that occurred during the quarter ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We, in common with the insurance industry in general, are subject to litigation and arbitration in the normal course of our business. As of September 30, 2026, we were not a party to any litigation or arbitration which is expected by management to have a material adverse effect on our results of operations and financial condition and liquidity.
ITEM 1A. RISK FACTORS
There were no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Issuer’s Repurchases of Equity Securities
The following table summarizes our purchases of common shares for the 2026 third quarter:
PeriodTotal Number of Shares
Purchased (1)		Average Price Paid per ShareTotal Number of Shares Purchased as Part of
Publicly Announced
Plans or Programs		Approximate Dollar
Value of Shares that
 May Yet be Purchased
Under the Plan or
Programs ($000’s) (2)
7/1/2026-7/31/2026132,819 $100.18 132,819 $2,144,864 
8/1/2026-8/31/20262,208,281 $99.52 2,205,649 $1,925,400 
9/1/2026-9/30/202612,492,518 $96.10 12,492,392 $725,147 
Total14,833,618 $96.65 14,830,860 
(1)This column represents (in whole shares) open market share repurchases, including an aggregate of 0 shares, 2,632 shares and 126 shares repurchased by Arch Capital during July, August and September, respectively, other than through publicly announced plans or programs. We repurchased these shares from employees in order to facilitate the payment of withholding taxes on restricted and performance shares granted and the exercise of stock appreciation rights, in each case at their fair value as determined by reference to the closing price of our common shares on the day the restricted shares vested or the stock appreciation rights were exercised.
(2)This column represents the remaining approximate dollar amount available at the end of each applicable period under Arch Capital’s repurchase authorization. On April 19, 2026, the Company increased its authorization for its existing share repurchase program by $3.0 billion, and having no expiration date. Repurchases may be effected from time to time in open market or privately negotiated transactions.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
During the three months ended September 30, 2026, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934) adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933).


ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
ITEM 6. EXHIBITS
Incorporated by Reference
Exhibit NumberExhibit DescriptionFormOriginal NumberDate FiledFiled Herewith
10.1X
10.2X
10.3X
10.4X
31.1X
31.2X
32.1
32.2
101.INSXBRL Instance Document
101.SCHXBRL Taxonomy Extension Schema Document
101.CALXBRL Taxonomy Extension Calculation Linkbase Document
101.DEFXBRL Taxonomy Extension Definition Linkbase Document
101.LABXBRL Taxonomy Extension Label Linkbase Document
101.PREXBRL Taxonomy Extension Presentation Linkbase Document
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)
*Furnished herewith
†Management contract or compensatory plan or arrangement.
(1) Certain schedules and similar attachments have been omitted pursuant to Item 601(a)(5) of Regulation S-K. Arch hereby undertakes to provide a copy of any omitted schedule or attachment, as applicable, to the Commission or its staff upon request.

ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q
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.
ARCH CAPITAL GROUP LTD.
(REGISTRANT)
/s/ Nicolas Papadopoulo
Date: November 4, 2026Nicolas Papadopoulo
Chief Executive Officer (Principal Executive Officer)
/s/ François Morin
Date: November 4, 2026François Morin
Executive Vice President, Chief Financial Officer (Principal Financial and Accounting Officer) and Treasurer
ARCH CAPITAL
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2026 THIRD QUARTER FORM 10-Q

Exhibit 10.1
FOURTH AMENDED AND RESTATED
ARCH CAPITAL GROUP LTD. INCENTIVE COMPENSATION PLAN
SECTION 1. Purpose.
Arch Capital Group Ltd., a Bermuda company (the “Company”), hereby establishes this Incentive Compensation Plan (as amended from time to time, the “Plan”) in order to provide the Company’s employees with an opportunity to earn annual bonus compensation as an incentive and reward for their efforts to achieve the financial and strategic objectives of the Company.
SECTION 2. Definitions.
2.1        “After-Tax Profit (Loss)” has the meaning specified on Schedule I hereto.
2.2        “Aggregate Target Amount” has the meaning specified in Section 4.3(a) hereof.
2.3        “Award” means the amount of bonus compensation to which an Eligible Employee is entitled for each Plan Year as determined by the Committee pursuant to Section 4 and 5 of the Plan.
2.4        “Board” means the Board of Directors of the Company.
2.5        “Cash Flow” has the meaning specified on Schedule I hereto.
2.6        “CAT Business” means business classified by the Company as property catastrophe reinsurance.
2.7        “Cause” means, with respect to an Eligible Employee, (a) theft or embezzlement by the Eligible Employee with respect to the Company or its Subsidiaries; (b) malfeasance or negligence in the performance of the Eligible Employee’s duties; (c) the commission by the Eligible Employee of any felony or any crime involving moral turpitude; (d) willful or prolonged absence from work by the Eligible Employee (other than by reason of disability due to physical or mental illness); (e) failure, neglect or refusal by the Eligible Employee to adequately perform his or her duties and responsibilities as determined by the Company; (f) continued and habitual use of alcohol by the Eligible Employee to an extent which materially impairs the Eligible Employee’s performance of his or her duties without the same being corrected within ten (10) days after being given written notice thereof; or (g) the Eligible Employee’s use of illegal drugs without the same being corrected within ten (10) days after being given written notice thereof.
2.8        “Code” means the Internal Revenue Code of 1986, as amended, including applicable regulations thereunder.


        
2.9    “Committee” means the Compensation and Human Capital Committee of the Board, or such other Board committee or subcommittee (or the entire Board) as may be designated by the Board to administer the Plan.
2.10    “Company” has the meaning specified in Section 1 hereof or any successor.
2.11    “Deficits” has the meaning specified in Section 4.3(d) hereof.
2.12    “Development Period” has the meaning specified in Section 4.3(e) hereof.
2.13    “Earned” has the meaning specified in Section 4.3(c) hereof.
2.14    “Eligible Employee” means an employee of the Company or its Subsidiaries, including any director who is an employee, who is selected to participate in the Plan by the Committee.
2.15        “Employer” means the Company, Arch Reinsurance Ltd., Arch Reinsurance Company, Arch Capital Group (U.S.) Inc., Arch Insurance Group Inc. and its Subsidiaries, Arch Capital Services Inc., and any other Subsidiary of the Company that becomes an Employer in accordance with Section 8.1 hereof.
2.16        “Equity” has the meaning specified on Schedule I hereto.        
2.17        “Formula Approach” has the meaning specified in Section 4.1 hereof.
2.18        “Formula Approach Pool” has the meaning specified in Section 4.3(a) hereof.
2.19        “Hurdle ROE” has the meaning specified in Section 4.3(b) hereof.
2.20        “Insurance Segment” means the insurance business segment of the Company and its Subsidiaries.
2.21    “Investment Income” has the meaning specified on Schedule I hereto.
2.22    “Maximum Carryforward Amount” has the meaning specified in Section 4.3(c) hereof.
2.23    “Maximum Formula Approach Pool” has the meaning specified in Section 4.3(c) hereof.
2.24    “Mortgage Segment” means the mortgage business segment of the Company and its Subsidiaries.
2.25        “Operating Expenses” has the meaning specified on Schedule I hereto.
2.26        “Permanent Disability” means, with respect to an Eligible Employee, those circumstances where the Eligible Employee is unable to continue to perform the usual customary duties of his or her assigned job for a period of six (6) months in any twelve (12) month period because of
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physical, mental or emotional incapacity resulting from injury, sickness or disease. Any questions as to the existence of a Permanent Disability shall be determined by a qualified, independent physician selected by the Company and approved by the Eligible Employee (which approval shall not be unreasonably withheld). The determination of any such physician shall be final and conclusive for all purposes of this Plan.
2.27        “Plan” has the meaning specified in Section 1 hereof.
2.28    ““Plan Year” means (i) with respect to the Target Bonus Approach, a calendar year and (ii) with respect to the Formula Approach, an underwriting (or policy) year commencing on January 1 and ending on December 31 during which an accounting shall be made for all Underwriting Profit (Loss) attributable to Policies having an inception or renewal date during such 12-month period.
2.29        “Policies” means policies, binders, contracts or agreements of insurance or reinsurance.        
2.30        “Pre-Tax Profit” has the meaning specified on Schedule I hereto.
2.31        “Reinsurance Segment” means the reinsurance business segment of the Company and its Subsidiaries.
2.32    “ROE” has the meaning specified on Schedule I hereto.
2.33            “Senior Executives” has the meaning set forth in Section 4.1 hereof.
2.34            “Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if each of the corporations (other than the last corporation in the unbroken chain) owns shares possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in the chain.
2.35    “Target Bonus Approach” has the meaning specified in Section 4.1 hereof.
2.36    “Target Bonus Approach Pool” has the meaning specified in Section 4.2(a) hereof.
2.37    “Target Bonus Opportunity” means, with respect to each Eligible Employee, a target bonus expressed as a percentage of his or her annual base salary, which is intended as an approximation of the bonus payment that would be paid if aggressive performance goals and other expectations are met by both the Eligible Employee and the business segment or unit he or she is employed by. The Target Bonus Opportunity for each Eligible Employee shall be periodically established (i) by senior management of the applicable business segment or unit and (ii) by the Committee, in the case of certain Senior Executives designated by the Committee (subject to applicable employment agreements).
2.38    “Underwriting Profit (Loss)” has the meaning specified on Schedule I hereto.
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    2.39     “Retirement Age” means the later of an Eligible Employee’s 55th birthday or the fifth anniversary of the first day of the Plan Year in which such Eligible Employee’s participation in the Plan commenced.
SECTION 3. Administration.
The Plan shall be administered by the Committee. The Committee shall have the authority, in its sole discretion, to administer the Plan and to exercise all of the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation, the authority to (i) establish performance goals for the awarding of Awards for each Plan Year; (ii) determine the Eligible Employees to whom Awards are to be made for each Plan Year; (iii) determine whether performance goals for each Plan Year have been achieved; (iv) authorize payment of Awards under the Plan; (v) adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan and make all other determinations and judgments relating to the Plan as it shall deem advisable; and (vi) interpret the terms and provisions of the Plan; provided that neither the Committee nor the Board shall have any discretion to reduce any previously determined Award. All determinations made by the Committee with respect to the Plan and Awards thereunder shall be final and binding on all persons, including the Company and all Eligible Employees.
SECTION 4. Determination of Awards.
4.1        Performance Measures. The Plan combines two sets of performance measures: (i) a qualitative judgment about progress and performance each Plan Year based on a number of factors, including the management plan for such Plan Year and non-prescribed measures (the “Target Bonus Approach”), as set forth in Section 4.2 hereof; and (ii) a quantitative, formula-based measure (the “Formula Approach”), as set forth in Section 4.3 hereof. The Target Bonus Approach shall apply to certain senior executives (the “Senior Executives”) of the Company and its Subsidiaries designated by the Committee from time to time. The Formula Approach shall apply to those Eligible Employees designated by the Senior Executives. All Eligible Employees that are not designated as subject to the Formula Approach shall be subject to the Target Bonus Approach. Awards under the Target Bonus Approach and the Formula Approach shall be determined as set forth in Section 4.2 and Section 4.3, respectively, and shall be payable as set forth in Section 5 hereof.
4.2        Target Bonus Approach.
        (a)    Target Bonus Approach Pool. Under the Target Bonus Approach, a separate bonus pool shall be established for the Company and certain of its Subsidiaries, the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and Arch Capital Services Inc. for each Plan Year (each, a “Target Bonus Approach Pool”). The Target Bonus Approach Pool for each segment for any given Plan Year shall initially equal the sum of the individual Target Bonus Opportunities for each Eligible Employee included in such segment, which amount shall be adjusted upward or downward to reflect the segment’s actual performance as recommended by senior management of the applicable business segment or unit but determined by the Committee. Performance shall be judged against the achievement of the strategic and financial
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objectives contained in the applicable management plan submitted to the Board for the Plan Year, peer group performance and other measures deemed applicable by the Committee.
    (b)    Individual Participation. At the individual level, actual performance bonuses for each Eligible Employee shall reflect both individual and segment performance. An Eligible Employee’s participation in the applicable Target Bonus Approach Pool shall be initially based on his or her Target Bonus Opportunity, which participation shall be adjusted based on his or her performance. Any such adjustments (other than those for Senior Executives, as determined by the Committee) shall be made in a zero sum manner and not affect the overall size of the Target Bonus Approach Pool. All performance assessments shall include both objective and subjective elements, and the general performance weighting guidelines between segment and individual performance to be applied to an Eligible Employee’s Target Bonus Opportunity shall be determined by senior management of the applicable business segment or unit.
4.3        Formula Approach.
        (a)    Formula Approach Pool. Under the Formula Approach, a separate bonus pool shall be established for the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for each Plan Year and other separate bonus pools may be established by the Committee (each, a “Formula Approach Pool”). The Formula Approach Pool for each of the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and any other segment pools for any given Plan Year shall initially equal the sum of the individual Target Bonus Opportunities for each Eligible Employee included in such segment (each, an “Aggregate Target Amount”). The actual Formula Approach Pool will be a percentage of the Aggregate Target Amount based upon the ROE achieved for such Plan Year. Schedule II sets forth the size of the Formula Approach Pool based on various levels of ROE, which schedule shall be reviewed and may be adjusted by the Committee for each Plan Year.

        (b)    Hurdle ROE. With respect to the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and any other segments, no Awards shall be payable for a given Plan Year unless a minimum ROE equal to the applicable hurdle rate set forth on Schedule II for the Plan Year, without taking into account any amounts carried forward pursuant to Section 4.3(c) hereof (the “Hurdle ROE”), is achieved by such segment for such Plan Year.
        (c)    Maximum Formula Approach Pool; Carryforwards. For any given Plan Year, the maximum Formula Approach Pool for each of the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and any other segments shall equal 200% of the applicable Aggregate Target Amount (each, a “Maximum Formula Approach Pool”). For any given Plan Year, on and after the third anniversary of the end of such Plan Year, Earned amounts in excess of each Maximum Formula Approach Pool up to an additional 200% of such applicable Aggregate Target Amount (the “Maximum Carryforward Amount”) shall be carried forward and made available, only to Eligible Employees who participated in such Plan Year, in Plan Years subsequent to such Plan Year where the applicable Maximum Formula Approach Pool is not expected to be Earned
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by the end of the applicable Development Period, provided that the Earned amount which may be carried forward to any subsequent Plan Year shall not exceed 25% of the Earned Maximum Carryforward Amount. Notwithstanding anything set forth in the Plan, for a given Plan Year, amounts payable with respect to each of the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and any other segment shall not exceed 15% of the Pre-Tax Profit for such segment, respectively, for such Plan Year. For purposes hereof, with respect to a given amount, “Earned” means the inception-to-date actual amount calculated for the applicable item through the end of the period being calculated.
        (d)    Deficits. After-Tax Losses (and not After-Tax Profit that is below the Hurdle ROE) for a given Plan Year (“Deficits”) shall offset available After-Tax Profit in subsequent Plan Years until all Deficits are eliminated.
        (e)    Development Period. For each Plan Year, the Formula Approach Pool for each of the Insurance Segment, the Mortgage Segment, the Reinsurance Segment and any other segment shall be calculated annually for 10 years (a “Development Period”). The first calculation shall be made within two and one half months following the end of the initial 12-month calendar year period included in each Plan Year, and the final calculation shall be made within two and one half months following the end of the tenth year following the commencement of such Plan Year, with losses and loss adjustment expenses (if any) projected to ultimate and discounted to present value basis at such time.
        (f)    CAT Business. The results of CAT Business shall be calculated over five-year periods based on actual catastrophe experience (terrorism included). Accordingly, at the end of (i) the fifth Plan Year and (ii) each five-year period thereafter, Underwriting Profit (Loss) and Cash Flow shall be initially determined for CAT Business for such five-year period, and then such Underwriting Profit (Loss) and Cash Flow shall be allocated to each Plan Year included in the five-year period based on net premiums written attributable to CAT Business Policies having an inception or renewal date within such Plan Year. Following such initial calculation, the results of CAT Business shall be part of the annual recalculations of Underwriting Profit (Loss) and Cash Flow for the remainder of the respective Development Period relating to each Plan Year.
        (g)    Individual Participation. Individual participation in the applicable Formula Approach Pool shall be initially determined based on the relative Target Bonus Opportunity of each of the designated Eligible Employees and shall be subject to adjustment each Plan Year by senior management of the applicable business segment or unit based on criteria it deems appropriate, provided that any such adjustments shall be made in a zero sum manner and not affect the overall size of the applicable Formula Approach Pool.
        (h)    Board Review of Formula Approach. If the Board or the Committee determines that the Formula Approach results in compensation levels that do not appropriately reflect the Company’s underlying performance, then the Board or the Committee may terminate the Formula Approach or make adjustments to it that it deems appropriate.
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SECTION 5. Payment of Awards.
5.1    Form of Award. Except as otherwise provided in Section 8.9 below, any Awards payable under this Plan shall be paid in cash.
5.2    Payout Period. For each Plan Year, and subject to Section 5.3 hereof, Awards under the Target Bonus Approach shall be paid after the end of the Plan Year and no later than March 15 of the of the year immediately following the Plan Year. For each Plan Year, and subject to Section 5.3 hereof, Awards under the Formula Approach shall be paid over a four-year period as follows: 40% shall be paid after the end of the Plan Year and no later than March 15 of the of the year immediately following the Plan Year (based on Company performance determined consistent with Section 4.3 above through the end of the Plan Year), and 20% shall be paid no earlier than January 1 and no later than March 15 of each of the years immediately following the end of each of the next three calendar years, in each case based on Company performance determined consistent with Section 4.3 above through the end of the calendar year immediately preceding the year of payment. Notwithstanding the foregoing, in the case of the property facultative reinsurance division of the Reinsurance Segment, for each Plan Year, and subject to Section 5.3 hereof, Awards under the Formula Approach shall be paid over a three-year period as follows: 60% shall be paid after the end of the Plan Year and no later than March 15 of the of the year immediately following the Plan Year (based on Company performance determined consistent with Section 4.3 above through the end of the Plan Year), and 20% shall be paid no earlier than January 1 and no later than March 15 of each of the years immediately following the end of each of the next two calendar years, in each case based on Company performance determined consistent with Section 4.3 above through the end of the calendar year immediately preceding the year of payment. If, following such initial four-year or three year, as applicable, period relating to a given Plan Year, any additional amounts are owed to Eligible Employees under the Formula Approach as a result of recalculation of the applicable Formula Approach Pool based on Company performance through the end of a calendar year, then such amounts shall be paid to such Eligible Employees no earlier than January 1 and no later than March 15 of the immediately following calendar year. Notwithstanding the foregoing, the payment schedule for Eligible Employees subject to the Formula Approach who are junior employees may be modified by senior management, but no such modification may result in any amount being paid later than March 15 of the calendar year immediately following the calendar year for which Company performance is used to determine the amount of the payment.
5.3    Continued Service. Each Eligible Employee must be employed by the Company at the time of each payment of an Award; provided, however, that, (x) in the event an Eligible Employee ceases to be an employee of the Company after the Award for a Plan Year is determined and communicated to the Eligible Employee but prior to the date all payments under an Award are made (i) due to termination (A) by the Company not for Cause or (B) with respect to an Eligible Employee designated by the Committee, by the Eligible Employee for Good Reason (as defined within such Eligible Employee's employment agreement, unless otherwise determined by the Committee), or (ii) as a result of death of the Eligible Employee, the Award shall no longer be subject to the condition that the Eligible Employee remain employed through the time of payment and payments under the Award shall be made when such Award payments are regularly made hereunder following such termination of employment (the
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amount of such payments, if any, shall be as calculated herein and, in the case of Formula Approach Awards, shall be based on the continued performance of the Company as set forth in Section 4.3 hereof); and (y) in the event an Eligible Employee ceases to be an employee of the Company prior to the date all payments under an Award are made (i) due to termination as a result of Permanent Disability or (ii) due to termination of employment (other than by the Company for Cause) after the attainment of Retirement Age, payments under such Award shall continue to be made when the Award payments are normally made hereunder (the amount of such payments, if any, shall be as calculated herein and, in the case of Formula Approach Awards, be based on the continued performance of the Company as set forth in Section 4.3 hereof), so long as  (x) the Eligible Employee provides advanced written notice of termination to the Company at least six (6) months prior to any termination of employment by the Eligible Employee (for Eligible Employees at the E-4 level and above) and three (3) months prior to any termination of employment by the Eligible Employee (for Eligible Employees at the E-5 level) setting forth the date of the termination (and provided that the Company may in its discretion waive all or part of the period of notice and select an earlier date of termination by the Eligible Employee), (y) the Eligible Employee remains employed in good standing through the end of the period of notice and (x) prior to the applicable payment date, such Eligible Employee does not, without the written consent of the Company, engage in any activity in competition with any activity of the Company or any of its Subsidiaries other than (i) serving on the board of directors (or similar governing body) of another company or (ii) serving as a consultant for no more than 26 weeks per calendar year providing services that do not, in whole or in part, relate to the business or operations of an insurance or reinsurance company; provided that if the Eligible Employee does engage in such activity after termination for such reasons, any unpaid portion of the Award shall be forfeited by the Eligible Employee and become the property of the Company. For purposes hereof, service with any of the Company’s Subsidiaries shall be considered to be service with the Company.
    Notwithstanding the foregoing, unless otherwise determined by the Committee, in the event an Eligible Employee who has been selected to participate in the Plan for a Plan Year dies during the Plan Year, a pro-rata portion (based on the number of days during the Plan Year elapsed through the date of death) of the Eligible Employee’s Target Bonus Opportunity for the Plan Year will be paid in a single lump sum in cash to the Eligible Employee’s Beneficiary on the date determined by the Company (which date shall not be later than March 15 of the following Plan Year). Such Eligible Employee (and his or her Beneficiaries) shall not be entitled to any additional amounts in respect of such Plan Year. For purposes of this Plan, “Beneficiary” means the person, persons, trust or trusts which have been designated by an Eligible Employee in his or her most recent written beneficiary designation filed with the Company to receive the benefits specified under this Plan upon the death of the Eligible Employee, or, if there is no designated Beneficiary or surviving designated Beneficiary, then the person, persons, trust or trusts entitled by will or the laws of descent and distribution to receive such benefits.
    Notwithstanding the foregoing, unless otherwise determined by the Committee, in the event an Eligible Employee’s employment terminates (other than by the Company for Cause) after the attainment of Retirement Age, after the beginning of a Plan Year and prior to the time the Award for the Plan Year is determined and communicated to the Eligible Employee, a pro-rata portion (based on the number of days during the Plan Year elapsed through the date of termination) of the Award for the Plan Year will
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be eligible to be earned based on achievement of the applicable performance goals. Payments under such Award shall be made when the Award payments are normally made hereunder (the amount of such payments, if any, shall be as calculated herein (with proration) and, in the case of Formula Approach Awards, be based on the continued performance of the Company as set forth in Section 4.3 hereof), so long as (i) the Eligible Employee provides advanced written notice of termination to the Company at least six (6) months prior to any termination of employment by the Eligible Employee (for Eligible Employees at the E-4 level and above) and three (3) months prior to any termination of employment by the Eligible Employee (for Eligible Employees at the E-5 level) setting forth the date of the termination (and provided that the Company may in its discretion waive all or part of the period of notice and select an earlier date of termination by the Eligible Employee), (ii) the Eligible Employee remains employed in good standing through the end of the period of notice and (iii) prior to the applicable payment date, such Eligible Employee does not, without the written consent of the Company, engage in any activity in competition with any activity of the Company or any of its Subsidiaries other than (i) serving on the board of directors (or similar governing body) of another company or (ii) serving as a consultant for no more than 26 weeks per calendar year providing services that do not, in whole or in part, relate to the business or operations of an insurance or reinsurance company; provided that if the Eligible Employee does engage in such activity after termination for such reasons, any unpaid portion of the Award shall be forfeited by the Eligible Employee and become the property of the Company.
    If the Eligible Employee ceases to be an employee of the Company for any other reason prior to the date that all amounts under an Award are paid, the Award, including applicable carryforwards, shall be forfeited by the Eligible Employee and become the property of the Company. For purposes hereof, service with any of the Subsidiaries shall be considered to be service with the Company. In the case of Awards made under the Formula Approach, the Awards shall include applicable carryforwards and Deficits, and terminated employees’ forfeited Awards, including applicable carryforwards, shall be removed from the applicable bonus pool.
SECTION 6. Non-Transferability.
No Award or rights under this Plan may be transferred or assigned other than by will or by the laws of descent and distribution.
SECTION 7. Amendments and Termination.
The Board may terminate the Plan at any time and may amend it from time to time, provided, however, that no termination or amendment of the Plan shall adversely affect the rights of an Eligible Employee or a beneficiary to a previously determined Award without the written consent of such Eligible Employee or beneficiary.
SECTION 8. General Provisions.
8.1     Subsidiaries. Any Subsidiary of the Company may, upon approval by the Committee, become an Employer under the terms of the Plan. Notwithstanding any provision of the Plan to the contrary, benefits payable under the Plan to an Eligible Employee or his or her beneficiary shall be the
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obligation of the Employer who actually employs (or, in the case an Eligible Employee who is no longer employed by an Employer, last employed) the Eligible Employee; provided, however, that in the event the Eligible Employee’s employer fails to make a payment of benefits to the Eligible Employee or his or her beneficiary when due under the terms of the Plan, the Company (the parent company of the Employers) shall be obligated to make such benefit payments in accordance with the terms of the Plan.
8.2        Unfunded Plan. The Plan shall be an unfunded incentive compensation arrangement. Nothing contained in the Plan, and no action taken pursuant to the Plan, shall create or be construed to create a trust of any kind. An Eligible Employee’s right to receive a bonus shall be no greater than the right of an unsecured general creditor of the Company. All bonuses shall be paid from the general funds of the Employers, and no segregation of assets shall be made to ensure payment of bonuses.
8.3        Withholding. The Company may provide for the withholding from any benefits payable under this Plan all Federal, state, city or other taxes as shall be required pursuant to any law or governmental regulation or ruling.
8.4    Excess Parachute Payments.
(a)    Notwithstanding any other provision of the Plan, in the event that the amount of payments or other benefits payable to any Eligible Employee under the Plan (including, without limitation, the acceleration of any payment or the accelerated vesting of any payment or other benefit), together with any payments, awards or benefits payable under any other plan, program, arrangement or agreement maintained by the Company or one of its affiliates, would constitute an “excess parachute payment” (within the meaning of Section 280G of the Code), the payments under this Plan shall be reduced (by the minimum possible amounts) until no amount payable to the Eligible Employee under the Plan constitutes an “excess parachute payment” (within the meaning of Section 280G of the Code); provided, however, that no such reduction shall be made if the net after-tax payment (after taking into account Federal, state, local or other income, employment and excise taxes) to which the Eligible Employee would otherwise be entitled without such reduction would be greater than the net after-tax payment (after taking into account Federal, state, local or other income, employment and excise taxes) to the Eligible Employee resulting from the receipt of such payments with such reduction.
(b)    All determinations required to be made under this Section 8.4, including whether a payment would result in an “excess parachute payment” and the assumptions to be utilized in arriving at such determinations, shall be made by an accounting firm designated by the Company (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Eligible Employee as requested by the Company or the Eligible Employee. All fees and expenses of the Accounting Firm shall be borne solely by the Company and shall be paid by the Company. Absent manifest error, all determinations made by the Accounting Firm under this Section 8.4 shall be final and binding upon the Company and the Eligible Employee.
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(c)    In the event the Eligible Employee has an employment agreement in effect with the Company or an affiliate providing for a similar excess parachute payment cutback, the cutback calculations and determinations under this Section 8.4 will be coordinated with the cutback calculations and determinations under the employment agreement, resulting in one calculation and one cutback determination. Any required cutback shall be made first to payments as provided under the employment agreement and then to payments under this Plan.
8.5        Hold Harmless. No member of the Board or the Committee, nor any officer or employee of the Company acting on behalf of the Board or the Committee, shall be personally liable for any action, determination or interpretation taken or made with respect to the Plan, and all members of the Board or the Committee and all officers or employees of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination or interpretation.
8.6        Other Benefits; No Right of Employment. Nothing set forth in this Plan shall prevent the Board or the Committee from adopting other or additional compensation arrangements. Neither the adoption of the Plan or any Award hereunder shall confer upon an Eligible Employee any right to continued employment.
8.7        Captions. The captions preceding the sections and articles hereof have been inserted solely as a matter of convenience and in no way define or limit the scope or intent of any provisions of the Plan.
8.8     Governing Law. The Plan shall be interpreted, construed and administered in accordance with the laws of the State of New York, without giving effect to principles of conflict of laws.
    8.9    Section 162(m). Payments under this Plan may be deferred by the Committee to the extent that the Committee reasonably anticipates that, if the payment were made as scheduled, the United States federal income tax deduction of any Subsidiary that is subject to United States federal income tax would not be permitted for the payment due to the application of Section 162(m) of the Code. Any payment deferred under this Section 8.9 shall be made, subject to the possible application of the delay provided for in Section 8.10 below, as soon as reasonably practicable following the first date on which the Company anticipates or reasonably should anticipate that, if the payment were made on such date, the Subsidiary’s deduction with respect to such payment would no longer be restricted due to the application of Section 162(m) of the Code. With respect to any amount deferred under this Section 8.9, the Committee, in its discretion, may credit notional earnings on the amount or substitute for the deferred payment, restricted share units in respect of common shares of the Company having a fair market value equal to the amount of the deferred payment, and common shares subject to the restricted share units shall be distributed at the time payments are to be made in accordance with this Section 8.9. Any restricted share units shall be granted under the Company’s 2018 Long Term Incentive and Share Award Plan (or any successor plan). If any scheduled payment to an Eligible Employee in a calendar year is delayed in accordance with this Section 8.9, all scheduled payments to that Eligible Employee that could be delayed in accordance with Treas. Reg. § 1.409A-2(b)(7)(i) shall also be delayed.
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For purposes of any deferral under this Section 8.9, the Company shall treat all payments to similarly situated employees on a reasonably consistent basis.
8.10    Sections 409A and 457A. It is intended that the Plan will comply with Sections 409A and 457A of the Code (and any regulations and guidelines issued thereunder) to the extent it is subject thereto, and the Plan shall be interpreted on a basis consistent with such intent. The Plan may be amended in any respect deemed by the Board or the Committee to be necessary in order to preserve compliance with Sections 409A and 457A of the Code. Notwithstanding any provision to the contrary in this Plan, if an Eligible Employee is deemed on the date of his or her “separation from service” (within the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company and its affiliates to be a “specified employee” (within the meaning of Treas. Reg. Section 1.409A-1(i)), then with regard to any payment that is considered deferred compensation under Section 409A payable on account of a “separation from service” that is required to be delayed pursuant to Section 409A(a)(2)(B) of the Code (after taking into account any applicable exceptions to such requirement), such payment shall be made on the date that is the earlier of (i) the expiration of the six (6)-month period measured from the date of the Eligible Employee’s “separation from service,” or (ii) the date of the Eligible Employee’s death (the “Delay Period”). Upon the expiration of the Delay Period, all payments delayed pursuant to this Section shall be paid to the Eligible Employee in a lump sum. The Company shall not have any obligation to indemnify or otherwise protect the Eligible Employee from any obligation to pay any taxes, interest or penalties pursuant to Sections 409A or 457A of the Code. Whenever payments under this Plan are to be made in installments, each such installment shall be deemed to be a separate payment for purposes of Section 409A.
SECTION 9. Effective Date of Plan.
The Plan became effective as of January 1, 2003, and shall remain in effect until such time as it may be terminated pursuant to Section 7 hereof. This Fourth Amendment and Restatement of the Plan became effective as of January 1, 2027.
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Schedule I
Unless otherwise indicated, all capitalized terms used below have the meanings specified in the Plan.
“ROE” means, with respect to each of the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, After-Tax Profit (Loss) divided by Equity. For each Plan Year, ROE shall be recalculated annually during the Development Period relating to such Plan Year.
“After-Tax Profit (Loss)” means, with respect to each of the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, the sum of (i) Underwriting Profit (Loss) and (ii) Investment Income, taxed based upon the effective tax rate of the Insurance Segment, Mortgage Segment or Reinsurance Segment, as applicable.
“Cash Flow” means, with respect to the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, net operating cash flow for such segment reflecting premiums and fees collected, net of reinsurance, loss and loss adjustment expenses paid, underwriting expenses paid and all other operating expenses, including unallocated loss adjustment expenses, allocation of expenses from the Company and Arch Capital Services Inc., federal excise taxes, applicable income taxes and costs of letters of credit, but excluding bonuses payable to Eligible Employees (“Operating Expenses”). For such purposes, CAT Business shall be reflected in the Formula Approach in the manner described in Section 4.3(f) of the Plan.
“Equity” means, with respect to each of the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, the amount of capital allocated to each such segment as recommended by senior management and determined by the Committee.
“Investment Income” means, with respect to the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, the sum of investment income, compounded as per the applicable U.S. treasury security, on:
(i)    Equity, calculated at a rate equal to the average rate earned on the investment portfolios of the Company and its Subsidiaries during the initial 12-month calendar year period included in the Plan Year, net of investment expenses relating to such portfolios; and
(ii)     Cash Flow, calculated at the following rates: (A) with respect to all business other than property business, the average risk free rate equal to the yield on a U.S. Treasury security with a duration equal to estimated weighted average duration of the underwriting (or policy) year liabilities, net of estimated investment expenses relating to a portfolio of U.S. Treasury securities, and, (B) with respect to property business, the average risk free rate equal to the yield on a U.S. Treasury security with a one year duration, net of estimated investment expenses relating to a portfolio of U.S. Treasury securities.


        
“Pre-Tax Profit” means, with respect to each of the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, the sum of (i) Underwriting Profit (Loss) and (ii) Investment Income.
“Underwriting Profit (Loss)” reflects, with respect to each of the Insurance Segment, the Mortgage Segment and the Reinsurance Segment for a given Plan Year, (i) net premiums earned, fee income, losses and loss adjustment expenses incurred and acquisition expenses attributable to Policies having an inception or renewal date within the Plan Year and (ii) all other Operating Expenses incurred during the initial 12-month calendar year period included in the Plan Year. For such purposes, CAT Business shall be reflected in the Formula Approach in the manner described in Section 4.3(f) of the Plan.

Exhibit 10.2

EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT ("Agreement"), dated as of November 1, 2017, between Arch Reinsurance Ltd., a Bermuda corporation (the "Company”), and Jerome Halgan (the "Executive").


The parties hereto agree as follows:

ARTICLE 1 DEFINITIONS
SECTION 1.01. Definitions. For purposes of this Agreement, the following terms have the meanings set forth below:

"Accounting Firm" has the meaning set forth in Section 12.10.

"Affiliate" means any Person, directly or indirectly, through one or more intermediaries, Controlling, Controlled by, or under common Control with the Company. For purposes hereof, (a) "Control" means the ownership, directly or indirectly, of (i) in the case of a corporation, Voting Securities (as defined below) representing 50% or more of the total voting power or value of all the then outstanding Voting Securities of such corporation or (ii) in the case of a partnership, limited liability company, association or other business entity ("Business Entity"), 50% or more of the partnership or other similar ownership interest of such Business Entity; and (b) "Voting Security" means any security of a corporation which carries the right to vote generally in the election of directors. For purposes of the definition of "Control," (x) a Person will be deemed to have a 50% or more ownership interest in a Business Entity if such Person is allocated 50% or more of Business Entity gains or losses or controls the managing director or member or general partner of such Business Entity; and (y) "Controlling" and "Controlled" have meanings correlative thereto.
"Base Salary" has the meaning set forth in Section 4.01.

"Bonus Amount" means the greater of (i) the Executive's target annual bonus for the year during which Notice of Termination is given, or (ii) the average of the Executive's actual annual bonus for the three years immediately preceding the year during which Notice of Termination is given (or such lesser number of years in which the Executive was employed by the Company or its Affiliate).

"Cause" means (a) theft or embezzlement by the Executive with respect to the Company or its Affiliates; (b) malfeasance or gross negligence in the performance of the Executive's


duties; (c) the Executive's conviction of any felony or any crime involving moral turpitude; (d) willful or prolonged absence from work by the Executive (other than by reason of disability due to physical or mental illness) or failure, neglect or refusal by the Executive to perform his duties and responsibilities without the same being corrected within ten (10) days after being given written notice thereof; (e) continued and habitual use of alcohol by the Executive to an extent which materially impairs the Executive's performance of his duties; (f) the Executive's use of illegal drugs; or (g) the material breach by the Executive of any of the covenants contained in this Agreement.

"Code" means the U.S. Internal Revenue Code of 1986, as amended.

"Confidential Information" means information that is not generally known to the public and that was or is used, developed or obtained by the Company or its Affiliates in connection with their business. It shall not include information (a) required to be disclosed by court or administrative order or called for in a subpoena or discovery request regular on its face, (b) lawfully obtainable from other sources or which is in the public domain through no fault of the Executive; or (c) the disclosure of which is consented to in writing by the Company.

"Date of Termination" has the meaning set forth in Section 5.01.

"Employment Period" has the meaning set forth in Section 2.01.

"Good Reason" means, without the Executive's written consent and subject to the timely notice requirement and the Company's opportunity to cure set forth In Section 5.05 below, (a) the material diminution of any material duties or responsibilities of the Executive; (b) a material reduction in the Executive's Base Salary; or (c) any material breach by the Company of the provisions contained in this Agreement.

"Intellectual Property" has the meaning set forth in Section 7.01.
"Notice of Termination" has the meaning set forth in Section 5.05. "Noncompetition Period" has the meaning set forth in Section 9.01. "Nonsolicitation Period" has the meaning set forth in Section 9.02.
"Person" means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, an estate, a trust, a joint venture, an unincorporated organization or a governmental entity or any department, agency or political subdivision thereof.

"Permanent Disability'' means those circumstances where the Executive Is unable to
continue to perform the usual customary duties of his assigned job or as otherwise assigned in accordance with the provisions of this Agreement for a period of six (6) months in any twelve



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(12) month period because of physical, mental or emotional incapacity resulting from injury, sickness or disease. Any questions as to the existence of a Permanent Disability shall be determined by a qualified, independent physician selected by the Company and approved by the Executive (which approval shall not be unreasonably withheld). The determination of any such physician shall be final and conclusive for all purposes of this Agreement.

"Reimbursable Expenses" has the meaning set forth in Section 4.04.

"Start Date" has the meaning set forth in Section 2.01.

ARTICLE 2 EMPLOYMENT
SECTION 2.01. Employment. The Company shall employ the Executive, and the Executive shall accept employment with the Company, for the period beginning on January 1, 2018 (the "Start Date") and ending on the Date of Termination as provided in Section 5.01(the "Employment Period"). If the Executive fails to satisfy the condition set forth in the preceding sentence, he shall forfeit all rights hereunder.

ARTICLE 3 POSITION AND DUTIES
SECTION 3.01. Position and Duties. During the Employment Period, the Executive shall serve as Chief Executive Officer of the Company and shall have such responsibilities, powers and duties as may from time to time be prescribed by the Board of Directors of the Company; provided that such responsibilities, powers and duties are substantially consistent with those customarily assigned to individuals serving in such positions at comparable companies or as may be reasonably required by the conduct of the business of the Company. During the Employment Period the Executive shall devote substantially all of his working time and efforts to the business and affairs of the Company. The Executive shall not directly or indirectly render any services of a business, commercial or professional nature to any other person or for-profit organization not related to the business of the Company or its Affiliates, whether for compensation or otherwise, without prior written consent of the Company.

SECTION 3.02. Work Location. While employed by the Company hereunder, the Executive shall perform his duties (when not traveling or engaged elsewhere in the performance of his duties) at the offices of the Company in Bermuda. The Executive shall travel to such places on the business of the Company in such manner and on such occasions as the Company may from time to time reasonably require.


ARTICLE 4



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BASE SALARY AND BENEFITS

SECTION 4.01. Base Salary. During the Employment Period, the Executive's base salary will be $525,000 per annum (the "Base Salary"). The Base Salary will be payable monthly on the 15th day of each month, two weeks in arrears and two weeks in advance. Annually during the Employment Period the Company shall review with the Executive his job performance and compensation, and if deemed appropriate by the Board of Directors of the Company, in its discretion, the Executive's Base Salary may be Increased. Normal hours of employment are 8:30 a.m. to 5:00 p.m., Monday to Friday. The Executive's salary has been computed to reflect that his regular duties are likely, from time to time, to require more than the normal hours per week and the Executive shall not be entitled to receive any additional remuneration for work outside normal hours.

SECTION 4.02. Bonuses. In addition to the Base Salary, the Executive shall be eligible to participate in an annual bonus plan on terms set forth from time to time by the Board of Directors of the Company. The Executive's target annual bonus will be 100% of his Base Salary.

SECTION 4.03. Benefits. In addition to the Base Salary, and any bonuses payable to the Executive pursuant to this Agreement, the Executive shall be entitled to the following benefits during the Employment Period:

(a) such major medical, life insurance and disability insurance coverage as is, or may during the Employment Period, be provided generally for other senior executive officers of the Company as set forth from time to time in the applicable plan documents;
(b) in addition to the usual public holidays and eight (8) paid days off for sick leave, a maximum of five (5) weeks of paid vacation annually during the term of the Employment Period (Section 11 of the Bermuda Employment Act 2000 shall otherwise not apply to the Executive's employment hereunder);
(c) benefits under any plan or arrangement available generally for the senior executive officers of the Company, subject to and consistent with the terms and conditions and overall administration of such plans as set forth from time to time in the applicable plan documents;
SECTION 4.04. Expenses. The Company shall reimburse the Executive for all reasonable expenses incurred by him in the course of performing his duties under this Agreement which are consistent with the Company's policies in effect from time to time with respect to travel, entertainment and other business expenses ("Reimbursable Expenses"), subject to the Company's requirements with respect to reporting and documentation of expenses.

SECTION 4.05. Share-Based Awards. The Executive shall be eligible to participate in the



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Company's Long Term Incentive and Share Award Plans (and any similar plan adopted by the Company) under which share-based awards may be granted, as determined by the Board of Directors of the Company in its discretion.


ARTICLE 5

TERM AND TERMINATION

SECTION 5.01. Term. The expected term of this Agreement is for at least three years from the Start Date. Notwithstanding the foregoing, the Employment Period shall in all events end on the Date of Termination, whenever occurring. For purposes of this Agreement, the "Date of Termination" shall mean the first to occur of the following: (a) the six (6) month anniversary of the Company providing Notice of Termination (as defined below) without Cause to the Executive; (b) immediately upon the Company providing Notice of Termination for Cause to the Executive; (c) the six (6) month anniversary of the Executive providing Notice of Termination specifying his resignation for Good Reason to the Company; (d) the six (6) month anniversary of the Executive providing Notice of Termination by the Executive without Good Reason to the Company; (e) the fifth (5th) day following the Company providing Notice of Termination to the Executive as a result of the Executive's Permanent Disability; and (f) the date of Executive's death. In the event that there are circumstances which would give rise to a termination by the Company for Cause, the Company may, in its sole and exclusive discretion, treat such termination as a termination without Cause. Upon termination of the Executive's employment with the Company for any reason, the Executive shall resign from all positions and in all capacities with the Company and its Affiliates or from any other company or other Person with which the Executive is serving at the Company's request.

SECTION 5.02 Resignation by the Executive Without Good Reason. If the Employment Period shall be terminated as a result of the Executive's resignation or leaving of his employment, other than for Good Reason, the Executive shall continue to: (a) receive Base Salary and benefits set forth in Section 4.03 through the Date of Termination, except that any amount payable after the Executive's "separation from service" (within the meaning of Treas. Reg. Section 1.409A-l(h)) with the Company will be subject to Section 12.09 below; and (b) the Company will make a cash lump sum payment to the Executive equal to one half of the sum of (I) the Bonus Amount, and (II) a pro-rated portion of the Bonus Amount based on the number of days elapsed In the calendar year through the date Notice of Termination is given, which payment shall be made on the date that is sixty (60) days following the Date of Termination, and (c) receive reimbursement of all Reimbursable Expenses incurred by the Executive prior to the Date of Termination. The Executive's entitlements under all other benefit plans and programs of the Company shall be as determined thereunder.

SECTION 5.03 Termination for Good Reason or Without Cause. If the Employment Period shall be terminated by the Executive for Good Reason or by the Company without Cause, the Executive shall continue to: (a) receive Base Salary through the six (6) month anniversary of
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the Date of Termination, such amount to be paid in accordance with the regular payroll practices of the Company (except that any amount otherwise payable after the Date of Termination and prior to the sixtieth (60th) day following the Date of Termination shall instead be paid on such sixtieth (60th) day), and except that any amount payable after the Executive's "separation from service" (within the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company will be subject to Section 12.09 below; (b) receive an amount equal to the sum of (i) the Executive's target annual bonus plus (ii) a pro-rated portion of the Executive's target annual bonus based on the number of days elapsed in the calendar year through the date Notice of Termination is given, one half of which amount shall be paid in cash in a single lump sum on the date that is sixty (60) days following the Date of Termination and the remaining half of which shall be paid in accordance with the regular payroll practices of the Company (except that any amount otherwise payable after the Date of Termination and prior to the sixtieth (60th) day following the Date of Termination shall instead be paid on such sixtieth (60th) day); (c) receive benefits set forth in Section 4.03 above through the Date of Termination, except that any amount payable after the Executive's "separation from service" (within the meaning of Treas. Reg. Section 1.409A-l(h)) with the Company will be subject to Section 12.09 below, and (d) receive his major medical insurance coverage benefits from the Company's plan in effect from time to time (provided the Executive continues to pay the portion of the premiums for such coverage that are charged to similarly situated active employees) for a period equal to the lesser of (i) six (6) months after the Date of Termination, and (ii) until the Executive is provided by another employer with benefits substantially comparable to the benefits provided by such plan; and (e) receive reimbursement for all Reimbursable Expenses incurred by the Executive prior to the Date of Termination. The Executive's entitlements under all other benefit plans and programs of the Company shall be as determined thereunder. Notwithstanding the foregoing, the Executive shall be entitled to the amounts described above (other than Base Salary and benefits as set forth in Section 4.03 through the Date of Termination) only if (i) the Executive has entered Into an irrevocable (except to the extent required by law, and to the extent required by law to be revocable, has not revoked) general release of claims, which, subject to Section 5.07 below, is reasonably satisfactory to the Company ("Release"), on or before the date that is fifty (SO) days following the Date of Termination (but not prior to the Date of Termination), and (ii) the Executive has not breached and does not breach the provisions of Sections 6.01, 7.01, 8.01, 9.01, 9.02 or 11.01of this Agreement.

SECTION 5.04 Termination for Other Reasons. If the Employment Period shall be terminated by the Company with Cause, as a result of the Executive's Permanent Disability or upon the Executive's death, the Executive (or his beneficiaries or estate, in the case of death) shall continue to (a) receive Base Salary and benefits set forth in Section 4.03 above through the Date of Termination, except that any amount payable after the Executive's "separation from service" (within the meaning of Treas. Reg. Section 1.409A-l(h)) with the Company will be subject to Section 12.09 below; and (b) in the case of termination due to the Executive's Permanent Disability or death, receive his major medical insurance coverage benefits from the Company's plan in effect at the time of such termination for a period equal to the lesser of (i) twelve (12) months after the Date of Termination, and (ii) until the Executive Is provided by another employer with benefits substantially comparable to the benefits provided by such plan;
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and (d) receive reimbursement for all Reimbursable Expenses incurred by the Executive prior to the Date of Termination. The Executive's entitlements under all other benefit plans and programs of the Company shall be as determined thereunder.

SECTION 5.05. Notice of Termination and Opportunity to Cure. Any termination by the Company for Permanent Disability or Cause or without Cause or by the Executive for Good Reason or without Good Reason shall be communicated by written Notice of Termination to the other party hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the date the termination is to take effect (consistent with the terms of this Agreement), the specific termination provision In this Agreement relied upon and, for a termination for Permanent Disability or for Cause or for a resignation for Good Reason, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of employment under the provision indicated. It shall be a condition precedent to the Executive's right to terminate employment for Good Reason that (i) the Executive shall first have given the Company written notice that an event or condition constituting Good Reason has occurred within ninety (90) days after such occurrence, and any failure to give such written notice within such period will result in a waiver by the Executive of his right to terminate for Good Reason as a result of such event or condition, and (ii) a period of thirty (30) days from and after the giving of such written notice shall have elapsed without the Company having effectively cured or remedied such occurrence during such 30-day period, unless such occurrence cannot be cured or remedied within thirty (30) days, in which case the period for remedy or cure shall be extended for a reasonable time (not to exceed an additional fifteen (15) days) provided that the Company has made and continues to make a diligent effort to effect such remedy or cure.

SECTION 5.06. Garden Leave. Following any Notice of Termination, whether by the Company or the Executive and until the end of the Employment Period, the Company may direct, in its sole and exclusive discretion, that the Executive perform no duties and exercise no powers or authorities in connection with his employment, resign from any office with the Company and its Affiliates and not attend any premises of any of the Company and its Affiliates; provided. however, that, following any such direction, the Executive will continue to be required to comply with his other obllgatlons under this Agreement and will continue to have a duty of loyalty to the Company as an employee ("Garden Leave"). Notwithstanding the above, the Company may at its discretion require the Executive to perform duties at any time during the Garden Leave, which duties may be withdrawn at any time at the Company's discretion, and, during the Garden Leave, the Executive shall: (a) remain an employee of the Company and be bound by the terms of this Agreement; (b) not, without the prior written consent of the Company, attend his place of work or any other premises of any of the Company and its Affiliates or access the information technology systems of the Company and its Affiliates; (c) not, without the prior written consent of the Company, contact or deal with (or attempt to contact or deal with) any officer, employee, consultant, client, customer, investor, supplier, agent, distributor, shareholder, adviser or other business contact of any of the Company and its Affiliates; (d) promptly disclose in writing to the Company any attempt at contact with the Executive made by any such person or entity with whom the Executive has been required to have no contact pursuant to this Section 5.06; and (e) be ready and available to perform such duties as the Company may require, ensuring that the Company knows where and
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how he can be contacted and complying with any written requests to contact a specified employee of the Company at specified Intervals.
SECTION 5.07 Release. In consideration of the mutual promises herein and the payments detailed in this Article 5, the Executive, on behalf of himself and his heirs and assigns, in a form reasonably satisfactory to the Company, shall, with respect to any termination of employment under Section 5.03, execute a Release which irrevocably and unconditionally releases and forever discharges, individually and collectively, the Company and its Affiliates, and each of their respective officers, directors, employees, shareholders, representatives, parent companies, subsidiaries, predecessors, successors, assigns, attorneys and all persons acting by, through or in concert with them, of and from any and all charges, claims, complaints, demands, liabilities or causes of action, known or unknown, that the Executive may have at the effective date of the Release or has ever had against any such Person. Notwithstanding any other provision hereof, the Executive shall not be required by any general release to release claims that the Executive may have against the Company that arise after the effective date of the Release, any rights the Executive may have to enforce Section 5.03 of this Agreement, or any rights of the Executive to be indemnified under the organizational documents of the Company and its Affiliates or under applicable law or pursuant to the Company's directors' and officers' liability insurance policies.
ARTICLE 6 CONFIDENTIAL INFORMATION
SECTION 6.01. Nondisclosure and Nonuse of Confidential Information. The Executive will not disclose or use at any time during or after the Employment Period any Confidential Information of which the Executive is or becomes aware, whether or not such Confidential Information is developed by him, except to the extent that such disclosure or use is directly related to and required by the Executive's performance of duties assigned to the Executive pursuant to this Agreement. Under all circumstances and at all times, the Executive will take all appropriate steps to safeguard Confidential Information in his possession and to protect it against disclosure, misuse, espionage, loss and theft.


SECTION 6.02. Defend Trade Secrets Act. Pursuant to 18 U.S.C. § 1833(b), the Executive understands that the Executive will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) is made (x) in confidence to a Federal, State, or local government official, either directly or indirectly, or to the Executive's attorney and (y) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is flied under seal in a lawsuit or other proceeding. The Executive understands that if the Executive files a lawsuit for retaliation by the Company for reporting a suspected violation of law, the Executive may disclose the trade secret to the Executive's attorney and use the trade secret information in the court proceeding if the Executive (I) files any document containing the trade secret under seal,


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and (II) does not disclose the trade secret, except pursuant to court order. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section. Further, nothing in this Agreement or any other agreement or arrangement with the Company or any of its Affiliates shall prohibit or restrict the Executive from making any disclosure of information or documents to any governmental agency or legislative body, any self-regulatory organization, the Legal Department of the Company, and/or pursuant to the whistleblower provisions of the Dodd-Frank Act or Sarbanes-Oxley Act.
ARTICLE 7 INTELLECTUAL PROPERTY
SECTION 7.01. Ownership of Intellectual Property. In the event that the Executive as part of his activities on behalf of the Company generates, authors or contributes to any invention, design, new development, device, product, method of process (whether or not patentable or reduced to practice or comprising Confidential Information), any copyrightable work (whether or not comprising Confidential Information) or any other form of Confidential Information relating directly or indirectly to the business of the Company as now or hereinafter conducted (collectively, "Intellectual Property''), the Executive acknowledges that such Intellectual Property is the sole and exclusive property of the Company and hereby assigns all right title and interest in and to such Intellectual Property to the Company. Any copyrightable work prepared in whole or in part by the Executive during the Employment Period will be deemed "a work made for hire" under Section 201(b) of the United States Copyright Act of 1976, as amended, and the Company will own all of the rights comprised in the copyright therein. The Executive will promptly and fully disclose all Intellectual Property and will cooperate with the Company to protect the Company's interests in and rights to such Intellectual Property (including providing reasonable assistance in securing patent protection and copyright registrations and executing all documents as reasonably requested by the Company, whether such requests occur prior to or after termination of Executive's employment hereunder).

ARTICLE 8

DELIVERY OF MATERIALS UPON TERMINATION OF EMPLOYMENT

SECTION 8.01. Delivery of Materials upon Termination of Employment. As requested by the Company, from time to time and upon the termination of the Executive's employment with the Company for any reason, the Executive will promptly deliver to the Company all property of the Company in the Executive's possession or within his control, including, without limitation, all copies and embodiments, In whatever form or medium, of all Confidential Information or Intellectual Property in the Executive's possession or within his control (including written records, notes, photographs, manuals, notebooks, documentation, program listings, flow charts, magnetic media, disks, diskettes, tapes and all other materials containing any Confidential Information or Intellectual Property), irrespective of the location or form of such
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property and, if requested by the Company, will provide the Company with written confirmation that all such property have been delivered to the Company.

ARTICLE 9 NONCOMPETITION AND NONSOLICITATION
SECTION 9.01. Noncompetition. The Executive acknowledges that during his employment with the Company, he will become familiar with trade secrets and other Confidential Information concerning the Company and its Affiliates and their respective predecessors, and that his services will be of special, unique and extraordinary value to the Company. In addition, the Executive hereby agrees that at any time during the Employment Period, and for a period ending one (1) year after the termination of the Executive's employment (the "Noncompetition Period"), he will not directly or indirectly own, manage, control, participate in, consult with, render services for or in any manner engage in any Restricted Business;
provided, however, that if the Executive's termination of employment occurs as a result of the Executive's resignation or leaving of his employment other than for Good Reason, except as provided in clause (Y) below, the Noncompetition Period shall continue beyond the Date of Termination only if (i) the Company pays the Executive, for each day during which the Noncompetition Period so continues (taking into account Section 9.04 below), an amount equal to 1/365th of the sum of (A) the Executive's annual Base Salary, plus (B) the Executive's Bonus Amount, and (C) a pro-rated portion of the Executive's Bonus Amount based on the number of days elapsed in the calendar year through the date Notice of Termination is given, such amount to be paid in accordance with the regular payroll practices of the Company (except that any amount otherwise payable after the Date of Termination and prior to the sixtieth (60th) day following the Date of Termination shall instead be paid on such sixtieth (60th) day); and (ii) the Executive shall continue to receive his major medical insurance coverage benefits from the Company's plan in effect from time to time (provided the Executive continues to pay the portion of the premiums for such coverage that are charged to similarly situated active employees) for a period equal to the lesser of (x) the end of the Noncompetition Period, and (y) until the Executive is provided by another employer with benefits substantially comparable (with no pre-existing condition limitations) to the benefits provided by such plan; and provided further, however, that:
(X) the Company may elect, in Its sole discretion, by written notice to the Executive given not more than ten (10) business days after the date Notice of Termination is given by the Executive without Good Reason, to not continue the Noncompetition Period beyond the Date of Termination or to reduce the Noncompetition Period under such circumstances so that it ends on the date set forth in such written notice (which shall not be later than twelve (12) months after the Date of Termination), in which case the Company's obligation to make
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payments and provide benefits under this Section 9.01shall end at the end of the Noncompetition Period, and
(Y) the Company's requirement to make payments under this Section 9.01as a condition to continuation of the Noncompetition Period shall apply only if the Executive has entered into a general release of claims reasonably satisfactory to the Company on or before the date that is fifty (SO) days following the Date of Termination (but not prior to the Date of Termination) and does not revoke such release prior to the end of any applicable revocation period (it being understood that such general release will not require the Executive to release his rights under this Section 9.01and will not contain any employment restrictions or non-solicitation obligations other than those set forth in this Agreement) and the Executive has not breached and does not breach the provisions of Sections 6.01, 7.01, 8.01, 9.01, 9.02 or 10.01hereof.
"Restricted Business" means (i) any business competing with the reinsurance businesses of the Company or its Affiliates as such businesses exist or are in process as of the date of termination, within any geographical area in which the Company or its Affiliates engage or plan to engage in such businesses, and (ii) any business that is materially competitive with the businesses that (I) are at the time in question being conducted by the Company or its Affiliates with which the Executive was involved to a material extent in the twelve (12) months prior to termination of the Executive's employment, or (II) were, during the Executive's employment, either being conducted by, or being actively developed by, the Company or Its Affiliates with which the Executive was involved to a material extent in the twelve (12) months prior to termination of Executive's employment. It shall not be considered a violation of this Section 9.01for the Executive to be a passive owner of not more than 2% of the outstanding stock of any class of a corporation which is publicly traded, so long as the Executive has no active participation in the business of such corporation.
SECTION 9.02. Nonsolicitation. The Executive acknowledges that during his employment with the Company, he will become familiar with trade secrets and other Confidential Information concerning the Company, its Affiliates and their respective predecessors, and that his services will be of special, unique and extraordinary value to the Company. The Executive hereby agrees that (a) during the Employment Period and for a period of one (1) year after the date of termination of employment (the "Nonsolicitation Period") the Executive will not, directly or indirectly, Induce or attempt to Induce any Relevant Employee of the Company or Its Affiliates to leave the employ of the Company or Its Affiliates, or in any way interfere with the relationship between the Company or its Affiliates and any Relevant Employee thereof or otherwise employ or receive the services of any individual who was a Relevant Employee of the Company or its Affiliates at the Date of Termination or within the twelve-month period prior thereto, and (b) during the Nonsolicitation Period, the Executive wlll not induce or attempt to induce any Restricted Customer to cease doing business with the Company or its Affiliates. For purposes of this Agreement, a "Relevant Employee" shall mean a director, officer, underwriter or manager of the Company or its Affiliates, in each case with whom the Executive had material dealings at any time during the period of twelve (12) months prior to the Date of Termination.
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A "Restricted Customer" shall mean any firm, company or Person who was a customer, investor, supplier, client, insured, reinsured, reinsurer, broker, agent, licensee or other business relation of the Company or its Affiliates and with whom Executive had material dealings during the twelve (12) months prior to termination of the Executive's employment.

SECTION 9.03. Enforcement. If, at the enforcement of Sections 9.01 or 9.02, a court holds that the duration or scope stated herein are unreasonable under circumstances then existing, the parties agree that the maximum duration and scope reasonable under such circumstances will be substituted for the stated duration or scope and that the court will be permitted to revise the restrictions contained in this Article 9 to cover the maximum duration and scope permitted by law.

SECTION 9.04 Coordination with Garden Leave. The lengths of the Noncompetition Period and the Nonsolicitation Period shall be reduced by any period that the Executive Is required to remain away from the office during his notice period or not undertake his normal duties pursuant to Section 5.06 above.

ARTICLE 10 EQUITABLE RELIEF
SECTION 10.01. Injunctive or Other Equitable Relief. The Executive acknowledges that
(a) the covenants contained herein are reasonable, (b) the Executive's services are unique, and
(c) a breach or threatened breach by him of any of his covenants and agreements with the Company and its Affiliates contained in Sections 6.01, 7.01, 8.01, 9.01or 9.02 could cause Irreparable harm to the Company or its Affiliates for which they would have no adequate remedy at law. Accordingly, and in addition to any remedies which the Company and its Affiliates may have at law, in the event of an actual or threatened breach by the Executive of his covenants and agreements contained in Sections 6.01, 7.01, 8.01, 9.01or 9.02, the Company and Its Affiliates shall have the absolute right, without the need to post a bond or any other type of security, to commence a lawsuit or other proceeding in any court of competent jurisdiction (the "Selected Court") seeking injunctive or other equitable relief (an "Injunction Proceeding"). In furtherance thereof, the Executive expressly and irrevocably agrees that the Selected Court may exercise personal jurisdiction over him in connection with any Injunction Proceeding and further agrees not to assert that any court other than the Selected Court is a more suitable forum for an Injunction Proceeding.

ARTICLE 11
EXECUTIVE REPRESENTATIONS
SECTION 11.01. Executive Representations. The Executive hereby represents and warrants to the Company that (a) the execution, delivery and performance of this Agreement by the Executive does not and will not conflict with, breach, violate or cause a default under
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any contract, agreement, instrument, order, judgment or decree to which the Executive is a party or by which he is bound, (b) the Executive is not a party to or bound by any employment agreement, noncompetition agreement or confidentiality agreement with any other Person that affects his right or ability to perform the duties contemplated by this Agreement, and (c) upon the execution and delivery of this Agreement by the Company, this Agreement will be the valid and binding obligation of the Executive, enforceable in accordance with its terms.

SECTION 11.02. Company Representations. The Company hereby represents and warrants to the Executive that (a) all acts required to be taken to authorize, deliver and perform this Agreement and the obligations of the Company provided for hereunder have been duly taken; and (b) upon the execution and delivery of this Agreement by the Company, this Agreement will be valid and binding obligation of the Company, enforceable in accordance with its terms.

ARTICLE 12 MISCELLANEOUS
SECTION 12.01. Remedies. The Company will have all rights and remedies set forth in
this Agreement, all rights and remedies which the Company has been granted at any time under any other agreement or contract and all of the rights which the Company has under any law. The Company will be entitled to enforce such rights specifically, without posting a bond or other security, to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. There are currently no disciplinary or grievance procedures in place, there is no collective agreement in place, and there is no probationary period.

SECTION 12.02. Consent to Amendments. The provisions of this Agreement may be amended or waived only by a written agreement executed and delivered by the Company and the Executive. No other course of dealing between the parties to this Agreement or any delay in exercising any rights hereunder will operate as a waiver of any rights of any such parties.

SECTION 12.03. Successors and Assigns. All covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto will bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not, provided that the Executive may not assign his rights or delegate his obligations under this Agreement without the written consent of the Company.

SECTION 12.04. Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.
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SECTION 12.05. Counterparts. This Agreement may be executed simultaneously in two counterparts, any one of which need not contain the signatures of more than one party, but all of which counterparts taken together will constitute one and the same agreement.

SECTION 12.06. Descriptive Headings. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

SECTION 12.07. Notices. All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement will be in writing and shall be delivered personally by hand, by electronic transmission (with a copy following by hand or by overnight courier), by registered or certified mail, postage prepaid, return receipt requested, or by overnight courier service (charges prepaid). Communications delivered personally by hand shall be deemed received on the date when delivered personally to the recipient; communications sent by electronic means shall be deemed received one (1) business day after the sending thereof; communications sent by registered or certified mail shall be deemed received four (4) business days after the sending thereof; and communications delivered by overnight courier shall be deemed received one (1) business day after the date when sent to the recipient. Such notices, demands and other communications will be sent to the Executive and to the Company at the addresses set forth below.

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If to the Executive:


If to the Company:

To the last address delivered to the Company by the Executive in the manner set forth herein.

Arch Capital Group Ltd. Waterloo House
100 Pitts Bay Road Hamilton HM 12, Bermuda Attention: Secretary
Tel: (441) 278-9250
Fax: 441-278-9255

or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

SECTION 12.08. Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.

SECTION 12.09. 409A and 457A. This Section 12.09 shall apply to the Executive only if, and to the extent, he is subject to Section 409A or Section 457A of the Code. It is intended that this Agreement will comply with Sections 409A and 457A of the Code (and any regulations and guidelines issued thereunder), to the extent the Agreement is subject thereto, and the Agreement shall be interpreted on a basis consistent with such intent. If an amendment of the Agreement is necessary in order for it to comply with Section 409A or Section 457A, the parties
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hereto will negotiate in good faith to amend the Agreement In a manner that preserves the original intent of the parties to the extent reasonably possible. No action or failure to act, pursuant to this Section 12.09 shall subject the Company to any claim, liability, or expense, and the Company shall not have any obligation to indemnify or otherwise protect the Executive from the obligation to pay any taxes, interest or penalties pursuant to Section 409A or Section 457A of the Code.

Notwithstanding any provision to the contrary in this Agreement, if the Executive is deemed on the date of his "separation from service" (within the meaning of Treasury Regulation Section 1.409A-l(h)) to be a "specified employee" within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment that is required to be delayed pursuant to Section 409A(a)(2)(B) of the Code (after taking into account the applicable provisions of Treasury Regulation Section 1.409A-l(b)(9)(11i)), the portion, if any, of such payment so required to be delayed shall not be made prior to the earlier of (i) the expiration of the six (6)-month period measured from the date of his "separation from service" or (ii) the date of his death (the "Delay Period"). Upon the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Executive in a lump sum, and any remaining payments due under this Agreement shall be paid in accordance with the normal payment dates specified for them herein. Whenever payments under this Agreement are to be made in installments, each such installment shall be deemed to be a separate payment for purposes of Section 409A of the Code. Notwithstanding any provision of this Agreement to the contrary, for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment that are considered deferred compensation under Section 409A, references to the Executive's "termination of employment" (and corollary terms) with the Company shall be construed to refer to the Executive's "separation from service" (within the meaning of Treas. Reg. Section 1.409A-l(h)) with the Company. In no case will compliance with this Section by the Company constitute a breach of the Company's obligations under this Agreement.

With respect to any reimbursement or in-kind benefit arrangements of the Company and its subsidiaries provided for herein that constitute deferred compensation for purposes of Section 409A, except as otherwise permitted by Section 409A, the following conditions shall be applicable: (i) the amount eligible for reimbursement, or in-kind benefits provided, under any such arrangement in one calendar year may not affect the amount eligible for reimbursement, or in-kind benefits to be provided, under such arrangement in any other calendar year (except that the health and dental plans may impose a limit on the amount that may be reimbursed or paid), (ii) any reimbursement must be made on or before the last day of the calendar year following the calendar year in which the expense was incurred, and (iii) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

SECTION 12.10. Section 4999 of the Code. Anything in this Agreement or the Company's Incentive Compensation Plan to the contrary notwithstanding, in the event it shall be
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determined that any payment, award, benefit or distribution (including, without limitation, the acceleration of any payment, award, distribution or benefit), by the Company or any of its affiliates to or for the benefit of the Executive (whether pursuant to the terms of this Agreement or otherwise) (a "Payment") would be subject to the excise tax imposed by Section 4999 of the Code or any corresponding provisions of state or local tax law (the "Excise Tax"), then such Payments shall either (a) be delivered In full, or (b) subject to, and in a manner consistent with the requirements of Section 409A of the Code, be reduced to the minimum extent necessary to ensure that no portion thereof will be subject to the Excise Tax, whichever of the foregoing amounts, taking into account the applicable federal, state or local income and employment taxes and the Excise Tax, results in receipt by the Executive, on an after-tax basis, of the greatest amount of payments and benefits, notwithstanding that all or some portion of such payments and benefits may be subject to the Excise Tax. In the event that any Payments are to be reduced pursuant to this Section 12.10, then the reduction shall be applied as follows:
(i) first, on a pro rata basis to the Executive's cash severance payments under Section 5.03 above, and (ii) second, on a pro rata basis to Executive's equity incentive awards. All determinations required to be made under this Article 12 shall be made by a nationally recognized accounting or consulting firm (other than the regular outside accounting firm retained by the Company) selected by the Company and agreed to by the Executive, which agreement shall not be unreasonably withheld (the "Accounting Firm"), which Accounting Firm shall provide detailed supporting calculations both to the Company and the Executive within 15 business days after the receipt of notice from the Company that the Executive has received a Payment, or such earlier time as is requested by the Company. Any determination by the Accounting Firm meeting the requirements of this Section 12.10 shall be binding upon the Company and the Executive. The fees and disbursements of the Accounting Firm shall be paid by the Company. If required, the Company shall enter into an engagement letter with the Accounting Firm containing reasonable and customary terms and provisions.

SECTION 12.11. No Third Party Beneficiary. This Agreement will not confer any rights or remedies upon any person other than the Company, the Executive and their respective heirs, executors, successors and assigns.

SECTION 12.12. Entire Agreement. This Agreement (including the documents referred to herein) constitutes the entire agreement among the parties and supersedes any prior understandings, agreements or representations by or among the parties, written or oral, that may have related in any way to the subject matter hereof, including, without limitation, the Employment Agreement, dated August 16, 2014, between Arch Reinsurance Company and the Executive. This Agreement shall serve as a written statement of employment for purposes of Section 6 of the Bermuda Employment Act 2000.

SECTION 12.13. Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party. Any reference to any federal, state, local or foreign statute or law will be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. The use of the word "including'' in this
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Agreement means including without limitation and is intended by the parties to be by way of example rather than limitation.

SECTION 12.14. Survival. Sections 3.04, 5.03, 5.04, 6.01, 6.02, 7.01, 8.01and Articles 9, 10, 11 and 12 will survive and continue in full force in accordance with their terms notwithstanding any termination of the Employment Period.

SECTION 12.15. GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS AGREEMENT WILL BE GOVERNED BY THE LAW OF BERMUDA, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS, SAVE THAT WHERE PROVISIONS OF FOREIGN LAW APPLY IN THIS AGREEMENT, THEY WILL BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH SUCH FOREIGN LAW.

SECTION 12.16. Arbitration. Save for where the Company chooses to exercise its rights as described in Section 10.01, in the event that a dispute or difference shall arise between the parties out of, in connection with, or concerning this Agreement, such dispute shall be referred to and determined by a sole arbitrator in a confidential private arbitration in accordance with the UNCITRAL rules as same are incorporated into the Bermuda International Conciliation and Arbitration Act 1986, except as they may be modified herein or by mutual agreement of the parties. Any such arbitration proceeding shall take place before a single arbitrator. The arbitrator shall be acceptable to both the Company and the Executive. However, if the parties cannot agree on an acceptable arbitrator, then the arbitrator is to be appointed by the Appointments' Committee of the Chartered Institute of Arbitrators Bermuda Branch. The seat of arbitration shall be Bermuda and it shall be conducted in the English language. The parties shall bear their respective costs (including attorney's fees) and shall split the fee of the arbitrators (50% paid by the Company and 50% by the Executive). Judgment upon the final award rendered by such arbitrator may be entered in any court having jurisdiction thereof.
Each party agrees that it shall maintain confidentiality in respect to any arbitration between them (including any decision rendered in such arbitration) except as necessary in connection with an enforcement proceeding or as required by law.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year first above written.
ARCH REINSURANCE LTD.
By:
/s/ Maamoun Rajeh
Name:
Maamoun Rajeh
Title:
Chairman, Arch Reinsurance Ltd.
/s/ Jerome Halgan
Jerome Halgan



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Exhibit 10.3
AMENDMENT TO EMPLOYMENT AGREEMENT
AMENDMENT TO EMPLOYMENT AGREEMENT (the “Amendment”), dated as of September 3, 2026, between Arch Reinsurance Ltd., a Bermuda corporation (the “Company”), and Jerome Halgan (the “Executive”).
WHEREAS, the Company and the Executive entered into an Employment Agreement dated as of November 1, 2017 (the “Agreement”);
WHEREAS, effective June 15, 2026, Arch Capital Group Ltd., a Bermuda exempted company (“Parent”), appointed the Executive to the office of Global Chief Executive Officer of Arch Reinsurance;
WHEREAS, the Company and the Executive wish to amend the terms and conditions of the Agreement as set forth herein;
WHEREAS, in that connection, the Company will assign the Agreement, as amended by this Amendment, to Parent, and Parent will assume and agree to perform the Company’s obligations under the Agreement, as amended by this Amendment, and, effective upon such assumption, the Company will have no further liability for the Agreement, as amended by this Amendment;
WHEREAS, the Executive wishes to agree to such assignment and assumption;
    NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the parties agree to amend the Agreement as follows.
I.Effective as of June 15, 2026, the Company irrevocably, absolutely and unconditionally assigns, transfers, conveys and delivers to Parent and its successors and permitted assigns forever all of the Company’s right, title and interest of every kind, nature and description in, to and under the Agreement, as amended hereby, and Parent hereby accepts the assignment, transfer, conveyance and delivery of the Agreement, as amended hereby, and Parent hereby irrevocably, absolutely and unconditionally assumes, undertakes and agrees to pay, perform and discharge in full, and release and discharge the Company and its successors and assigns, irrevocably, completely, unconditionally and forever from any and all obligations under the Agreement, as amended hereby; and, effective on the effective date of such assignment and assumption, all references to the “Company” in the Agreement, as amended hereby, shall be to Parent. The Executive hereby agrees and consents to such assignment and assumption.
II.The first sentence of SECTION 3.01 Position and Duties is amended, effective June 15, 2026, to read in its entirety as follows:
“During the Employment Period, the Executive shall serve as Global Chief Executive Officer of Arch Reinsurance and shall have such responsibilities, powers and duties as may from
    



time to time be prescribed by the President of Parent; provided that such responsibilities, powers and duties are substantially consistent with those customarily assigned to individuals serving in such position at comparable companies or as may be reasonably required by the conduct of the business of the Company.”
III.SECTION 3.01 Position and Duties is further amended by adding the following new sentence at the end thereof:
“The Executive shall be subject to, and comply in all material respects with, all Company policies covering the Executive, as in effect from time to time.”
IV.SECTION 4.01. Base Salary is amended, effective June 15, 2026, by deleting the first sentence thereof and replacing it with the following:
“Effective June 15, 2026, the Executive’s base salary of $700,000 will be increased to $800,000 per annum (the “Base Salary”).”
V.SECTION 4.02 Bonuses is amended, effective June 15, 2026, by deleting the second sentence thereof and replacing it with the following:
“For the 2026 calendar year, the Executive’s target annual bonus will be 135% of the amount of his Base Salary payable for the portion of the year prior to June 15, 2026, and 175% of the amount of his Base Salary payable for the portion of the year on and after June 15, 2026. The Executive's target annual bonus will be 175% of the amount of his Base Salary for calendar years after the 2026 calendar year.”
VI.SECTION 5.06 Garden Leave is amended to read in its entirety as follows:
“Following any Notice of Termination, whether by the Company or the Executive and until the end of the Employment Period, the Company may direct, in its sole and exclusive discretion, that the Executive perform no duties and exercise no powers or authorities in connection with the Executive’s employment, resign from any office with the Company and its Affiliates and not attend any premises of any of the Company and its Affiliates; provided, however, that, following any such direction, the Executive will continue to be required to comply with the Executive’s other obligations under this Agreement and will continue to owe a duty of good faith and fidelity to the Company as an employee (“Garden Leave”). Notwithstanding the above, the Company may at its discretion require the Executive to perform duties at any time during the Garden Leave, which duties may be withdrawn at any time at the Company’s discretion, and, during the Garden Leave, the Executive shall: (a) remain an employee of the Company and be bound by the express and implied terms of this Agreement; (b) not, without the prior written consent of the Company, attend the Executive’s place of work or any other premises of any of the Company and its Affiliates or access the information technology systems of the Company and its Affiliates; (c) not, without the prior written consent of the Company, contact or deal with (or attempt to contact or deal with) any officer, employee, consultant, client, customer, investor, supplier, agent, distributor, shareholder, adviser or other business contact of any of the Company and
2

its Affiliates; (d) promptly disclose in writing to the Company any attempt at contact with the Executive made by any such person or entity with whom the Executive has been required to have no contact pursuant to this Section 5.06; (e) be ready and available to perform such duties as the Company may require, ensuring that the Company knows where and how the Executive can be contacted and complying with any written requests to contact a specified employee of the Company at specified intervals; and (f) be deemed to take any accrued holiday during the Garden Leave period.”
VII.New SECTION 9.05 Notice of Covenants is added to read in its entirety as follows:
“Notice of Covenants. If the Executive receives an offer to, during the Employment Period or before the expiry of the Noncompetition Period or the Nonsolicitation Period, directly or indirectly own, manage, control, participate in, consult with, render services for or in any manner engage in any Restricted Business, the Executive shall provide the Person making the offer a copy of this Article 9.”
VIII.SECTION 12.16 Arbitration is amended to read in its entirety as follows:
“Arbitration. Save for where the Company or its Affiliates choose to exercise their rights as described in Section 10.01, any dispute or difference arising out of or relating in any way whatsoever to this Agreement or the subject matter hereof shall be referred to and finally determined by arbitration (the “Arbitration”). The seat, or legal place, of the Arbitration shall be Bermuda. The Arbitration shall be conducted before a sole arbitrator appointed by agreement between the parties or, failing such agreement, by the Appointments’ Committee of the Chartered Institute of Arbitrators Bermuda Branch (the “Arbitrator”). Unless the parties agree otherwise, the Arbitration shall be conducted in accordance with the UNCITRAL rules in force at the time the Arbitration is commenced. The courts of Bermuda (as the supervisory courts of the Arbitration) shall have exclusive jurisdiction to hear and determine any application for relief in aid of the Arbitration (including any application for interim or conservatory measures prior to the appointment of the Arbitrator), except that either party may bring proceedings before any court or other judicial authority of competent jurisdiction for the purposes of enforcing any partial or final award rendered by the Arbitrator hereunder. Each party agrees that it shall maintain confidentiality in respect to the Arbitration (including any award or other decision rendered in such Arbitration), except as necessary in connection with a proceeding to enforce the Arbitrator’s award or as otherwise required by law. The parties shall bear their respective costs (including attorney’s fees) and shall split the fee of the Arbitrator (50% paid by the Company and 50% by the Executive).”
IX.SECTION 12.12 Entire Agreement is amended to read as follows:
“This Agreement (including the documents referred to herein) together with the Amendment dated as of September 3, 2026, constitutes the entire agreement among the parties and supersedes any prior understandings, agreements or representations by or among the parties, written or oral, that may have related in any way to the subject matter
3

hereof, including, without limitation, the Employment Agreement, dated August 16, 2014, between Arch Reinsurance Company and the Executive.”
    Except as amended by this Amendment, all other terms and conditions of the Agreement will remain in full force and effect in accordance with its terms. This Amendment will be governed by the laws of Bermuda without regard to principles of conflict of laws thereof. This Amendment may be executed in counterparts, each of which will be deemed to be an original copy of this Amendment and all of which, when taken together, will be deemed to constitute one and the same Amendment.
[signatures on following page]
4

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date and year first written above.
ARCH REINSURANCE LTD.
By:
/s/ Maamoun Rajeh
Name:
Maamoun Rajeh
Title:
Director
ARCH CAPITAL GROUP LTD.
By:
/s/ Maamoun Rajeh
Name:
Maamoun Rajeh
Title:
President
/s/ Jerome Halgan
Jerome Halgan
5
Exhibit 10.4
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT ("Agreement"), dated as of March 1, 2019, between Arch
U.S. Ml Services Inc., a Delaware corporation (the "Company"), and Michael Schmeiser (the
"Executive").
WHEREAS, the Executive has been promoted to the positions described In Section 3.01
below;
WHEREAS, in connection with the promotion and in exchange for and contingent on the
Executive's execution of this Agreement, the Executive's base salary will be increased to the
amount set forth in Section 4.01below, he will receive the equity grant from the Company
described In Section 4.06 below and he will be entitled to the severance benefits on the terms
set forth in Article 5 below;
WHEREAS, the Executive's positions with the Company and its Affiliates will give him
access to Confidential Information (as defined herein) of the Company and its Affiliates (as
defined herein);
WHEREAS, the Executive's positions with the Company and its Affiliates will give the
Executive certain opportunities, on behalf of the Company, to work with and develop
relationships with employees, customers, investors, clients, insured, reinsureds, brokers,
agents, and licensees of the Company and its Affiliates; and
WHEREAS, the parties agree that this Agreement is necessary for the protection and
preservation of the proprietary and confidential information of the Company and its Affiliates,
the protection and preservation of the goodwill of the Company and its Affiliates, and the
protection and preservation of the relationships that the Company has with its employees,
customers, investors, clients, insureds, reinsureds, brokers, agents, licensees, and others with
which the Company has a business relationship; and
NOW, THEREFORE, in consideration of the Executive's continued employment as
provided herein, the Executive's increased base salary, his receipt of an equity grant from the
Company, his severance benefits payable as set forth herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. For purposes of this Agreement, the following terms have the
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meanings set forth below:
"Accounting Firm" has the meaning set forth in Section 12.10(b).
"Affiliate" means any Person, directly or indirectly, through one or more
intermediaries, Controlling, Controlled by, or under common Control with the Company. For
purposes hereof,
(a)"Control" means the ownership, directly or indirectly, of (i) in the case of a corporation,
Voting Securities (as defined below) representing 50% or more of the total voting power or
value of all the then outstanding Voting Securities of such corporation or (ii) in the case of a
partnership, limited liability company, association or other business entity ("Business Entity''),
50% or more of the partnership or other similar ownership interest of such Business Entity; and
(b)"Voting Security" means any security of a corporation which carries the right to vote
generally in the election of directors. For purposes of the definition of "Control," (x) a Person
will be deemed to have a 50% or more ownership Interest in a Business Entity if such Person is
allocated 50% or more of Business Entity gains or losses or controls the managing director or
member or general partner of such Business Entity; and (y) "Controlling" and "Controlled" have
meanings correlative thereto.
"Base Salary" has the meaning set forth In Section 4.01.
"Bonus Amount" means for termination of the Executive's employment occurring
during a calendar year, the greater of (i) the Executive's target annual bonus for the year of
such termination of employment, or (ii) the average of the Executive's actual annual bonus for
the three immediately preceding years (or such lesser number of years in which the Executive
was employed by the Company or its Affiliate).
"Cause" means (a) theft or embezzlement by the Executive with respect to the
Company or its Affiliates; (b) intentional malfeasance or gross negligence in the performance
of the Executive's duties; (c) the conviction of the Executive of any felony or any crime involving
moral turpitude; (d) willful or prolonged absence from work by the Executive (other than by
reason of disability due to physical or mental illness) or failure, neglect or refusal by the
Executive to perform his duties and responsibilities without the same being corrected within
ten (10) days after being given written notice thereof; (e) continued and habitual use of
alcohol by the Executive to an extent which materially impairs the Executive's performance of
his duties; (f) the Executive's use of illegal drugs; or (g) the material breach by the Executive of
any of the covenants contained in this Agreement.
"Code" has the meaning set forth in Section 12.09.
"Confidential Information" means information that is not generally known to the
public and that was or is used, developed or obtained by the Company or its Affiliates in
connection with their business. It shall not include information (a) required to be disclosed by
court or administrative order (subject to the Executive's compliance with the notice
requirements set forth in Section 6.01 below); (b) lawfully obtainable from other sources or
which is in the public
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domain through no fault of the Executive; or (c) the disclosure of which is consented to by
the Company.
"Date of Termination" has the meaning set forth In Section 5.06 and Section 5.02.
"Employment Period" has the meaning set forth In Section 2.01 and Section 5.02.
"Good Reason" means, without the Executive's written consent and subject to the
timely notice requirement and the Company's opportunity to cure set forth in Section 5.05
below, (a) the material diminution of any material duties or responsibilities of the Executive; (b)
a material reduction in the Executive's Base Salary; or (c) any material breach by the Company
of the provisions contained in this Agreement.
"Intellectual Property" has the meaning set forth In Section 7.01.
"Notice of Termination" has the meaning set forth In Section 5.05.
"Noncompetition Period" has the meaning set forth in Section 9.01.
"Nonsolicitation Period" has the meaning set forth In Section 9.02.
"Person" means an Individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, an estate, a trust, a joint venture, an
unincorporated organization or a governmental entity or any department, agency or political
subdivision thereof.
"Permanent Disability" means those circumstances where the Executive is unable
to continue to perform the usual customary duties of his assigned job or as otherwise
assigned in accordance with the provisions of this Agreement for a period of six (6)
consecutive months in any twelve (12) month period because of physical, mental or
emotional Incapacity resulting from injury, sickness or disease. Any questions as to the
existence of a Permanent Disability shall be determined by a qualified, independent
physician selected by the Company and approved by the Executive (which approval shall
not be unreasonably withheld). The determination of any such physician shall be final and
conclusive for all purposes of this Agreement.
"Reimbursable Expenses" has the meaning set forth in Section 4.04.
"Start Date" has the meaning set forth in Section 2.01.
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ARTICLE 2
EMPLOYMENT
SECTION 2.01. Employment. The Company shall employ the Executive as provided
herein, and the Executive shall accept such employment, for the period beginning as of March 1,
2019 (the "Start Date") and ending as provided in Section 5.01(the "Employment Period"). If
the Executive fails to satisfy the condition set forth in the preceding sentence, he shall forfeit all
rights hereunder.
ARTICLE 3
POSITION AND DUTIES
SECTION 3.01. Position and Duties. During the Employment Period, the Executive
shall serve as President and Chief Executive Officer of the Company and shall have such
responsibilities, powers and duties as may from time to time be prescribed by the Board of
Directors of the Company; provided that such responsibilities, powers and duties are
substantially consistent with those customarily assigned to Individuals serving In such position
at comparable companies or as may be reasonably required by the conduct of the business of
the Company.
The Executive understands and agrees that in these positions, he will have access to and
become familiar with confidential and trade secret information belonging to the Company and
its Affiliates, the Company's manner of doing business, the manner in which Affiliates do
business, future plans of the Company and Its Affiliates, and confidential information relating to
customers, employees, and business relations of the Company and its Affiliates. The Executive
acknowledges that such information has been and will be established at great expense to the
Company and its Affiliates and that the Company has a legitimate business interest in
protecting such Information from disclosure to competitors or otherwise.
During the Employment Period, the Executive shall devote substantially all of his
working time and efforts to the business and affairs of the Company and its Affiliates. The
Executive shall not directly or indirectly render any services of a business, commercial or
professional nature to any other person or for-profit organization not related to the business of
the Company or Its Affiliates, whether for compensation or otherwise, without prior written
consent of the Company. During the Employment Period, the Executive will comply with the
Company's Code of Business Conduct, as in effect for time to time.
ARTICLE4
BASE SALARY AND BENEFITS
SECTION 4.01. Base Salary. During the Employment Period, the Executive's base salary
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will be $450,000 per annum (the "Base Salary"). The Base Salary will be payable by the
Company bi-monthly on the 15th and last working day of each month. Annually during the
Employment Period, the Company shall review with the Executive his job performance and
compensation, and if deemed appropriate by the Company, in its discretion, the Executive's
Base Salary may be increased.
SECTION 4.02. Bonuses. In addition to the Base Salary, the Executive shall be
eligible to participate in an annual bonus plan on terms set forth from time to time by the
Board of Directors of the Company. The Executive's target annual bonus will be 100% of his
Base Salary.
SECTION 4.03. Benefits. In addition to the Base Salary, and any bonuses payable to
the Executive pursuant to this Agreement, the Executive shall be entitled to the following
benefits during the Employment Period:
(a)such major medical, life insurance and disability insurance coverage
as is, or may during the Employment Period be, provided generally for other senior
executive officers of the Company as set forth from time to time in the applicable
plan documents;
(b)in accordance with applicable policies, «Vacation_Days» vacation
days and 10 sick days annually (each of which will be pro-rated for partial years)
during the Employment Period; and
(c)benefits under any plan or arrangement available generally for the
senior executive officers of the Company, including the Executive Supplemental Non-
Qualified Savings and Retirement Plan, subject to and consistent with the terms
and conditions and overall administration of such plans as set forth from time to time
in the applicable plan documents.
SECTION 4.04. Expenses. The Company shall reimburse the Executive for all
reasonable expenses incurred by him in the course of performing his duties under this
Agreement which are consistent with the Company's policies in effect from time to time with
respect to travel, entertainment and other business expenses ("Reimbursable Expenses"),
subject to the Company's requirements with respect to reporting and documentation of
expenses.
SECTION 4.05. Share-Based Awards. The Executive shall be eligible to participate in
the Company's Long Term Incentive and Share Award Plans (and any similar plan adopted
by the Company) under which share-based awards may be granted, as determined by the
Board of Directors of the Company in its discretion.
SECTION 4.06 Equity Award. Subject to approval by the Board of Directors of Arch
Capital Group Ltd. ("Parent''), on the date this Agreement has been fully-executed by the
parties ("Grant Date"), the Executive will receive a signing bonus consisting of the share-
based awards of Parent valued at $232,500 in the aggregate, consisting of (a) 65.81%
performance shares of Parent ("Performance Shares"), (b) 25.93% non-qualified options to
purchase
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common shares of Parent ("Stock Options") and (c) 8.26% restricted common shares of
Parent ("Restricted Shares") (with the percentages relating to the value of each award
component). The Performance Shares will vest on March 10, 2022 (based on achievement of
performance goals), and the Stock Options and the Restricted Shares will vest in three equal
annual installments on the first anniversary of the Grant Date, February 28, 2021 and
February 28, 2022, provided that, in each case, on each such date the Executive is still an
employee of the Company as set forth in the award agreements.
For these purposes, the (a) the number of Performance Shares will be determined
by dividing the performance award target award value by the closing price of Parent's
common shares on the Grant Date, (b) the number of Stock Options will be determined by
Parent based on a Black-Scholes valuation consistent with the manner in which Parent
reflects options in its consolidated financial statements, and (c) the number of Restricted
Shares will be determined by dividing the restricted share award value by the closing price
of Parent's common shares on the Grant Date. The Stock Options will have an exercise
price per share equal to the closing market price of Parent's common shares on the Grant
Date. The terms and conditions of the Performance Shares and the Stock Options will be
as set forth in the award agreements.
ARTICLE 5
TERM AND TERMINATION
SECTION 5.01. Term. The Employment Period will terminate on the third anniversary
of the Start Date; provided that (a) the Employment Period shall terminate prior to such date
upon the Executive's death or Permanent Disability, (b) the Employment Period may be
terminated by the Company for any reason prior to such date, and (c) the Employment Period
may be terminated by the Executive prior to such date, if such termination shall be for Good
Reason. In addition, this Agreement will be automatically extended on the same terms and
conditions for successive one year periods following the original term until either the Company
or the Executive, at least ninety (90) days prior to the expiration of the original term or any
extended term, shall give written notice of their intention not to renew the Agreement. Upon
termination of the Executive's employment with the Company for any reason, the Executive
shall resign from all positions and in all capacities with the Company and its Affiliates or from
any other company or other Person with which the Executive is serving at the Company's
request.
SECTION 5.02. Unjustified Termination. Except as otherwise provided in Section 12.09,
if the Employment Period shall be terminated (i) at the end of the Employment Period due to
the Company giving written notice of non-extension pursuant to Section 5.01 above, or (ii)
prior to the expiration of the original term (or the Employment Period as extended pursuant
to Section 5.01) by the Executive for Good Reason or by the Company not for Cause (such
terminations under clauses (i) and (ii) of this Section 5.02 are collectively referred to as
"Unjustified Terminations"), the Executive shall be paid solely (except as additionally
provided in Section 5.04 below or the Company's Incentive Compensation Plan or successor
plan) his Base Salary
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earned through the date of termination of employment and an amount equal to the sum of (A)
his annual Base Salary, (B) his target annual bonus, and (C) a pro-rated portion of the
Executive's target annual bonus based on the number of days elapsed in the calendar year
through the Date of Termination.
The Executive shall be entitled to such payments set forth in clauses (A), (B) and (C) of
this Section only If the Executive has fully complied with and continues to fully comply with the
provisions of Sections 6.01, 7.01, 8.01, 9.01or 9.02 hereof and the Executive has entered into
a general release of claims reasonably satisfactory to the Company on or before the date that
is fifty (SO) days following the Date of Termination and does not revoke such release prior to
the end of the statutory seven (7) day revocation period (it being understood that such general
release will not require the Executive to release his rights under Sections 5.02 and 5.04 of this
Agreement and will not contain any employment restrictions or non-solicitation obligations
other than those set forth in this Agreement).
Subject to Section 12.09 below, such amounts will be paid in twelve (12) equal
installments, the first two (2) of which shall be paid on the date that is two (2) months following
the Date of Termination and the next ten (10) of which will be paid in ten (10) equal monthly
installments commencing on the date that is three (3) months following the Date of
Termination and continuing on each of the next nine (9) monthly anniversaries of the Date of
Termination. In addition, promptly following an Unjustified Termination, the Executive shall
also be reimbursed for all Reimbursable Expenses incurred by the Executive prior to such
Unjustified Termination. Notwithstanding any provision hereof to the contrary, in order for the
Executive to terminate the Employment Period for Good Reason, such termination of
employment must occur no later than sixty (60) days after the date the Executive gives written
notice in accordance with Section 5.05 below to the Company of the occurrence of the event or
condition that constitutes Good Reason.
SECTION 5.03. Justified Termination. If the Employment Period shall be terminated
(i) prior to the expiration of the original term (or the Employment Period as extended
pursuant to Section 5.01) (a) by the Company for Cause, (b) as a result of the Executive's
resignation or leaving of his employment, other than for Good Reason or (c) as a result of
the death or Permanent Disability of the Executive, or (ii) at the end of the Employment
Period as a result of the Executive's provision of written notice not to extend the
Employment Period under Section 5.01 (such terminations under clauses (i) and (ii) of this
Section 5.03 are collectively referred to as "Justified Terminations"), the Executive shall
be entitled to receive solely (except as additionally provided in Section 5.04 below or the
Company's Incentive Compensation Plan or successor plan) his Base Salary earned
through the date of termination of employment and reimbursement of all Reimbursable
Expenses incurred by the Executive prior to such Justified Termination.
SECTION 5.04. Benefits. Except as otherwise required by mandatory provisions of
law, all of the Executive's rights to fringe and other benefits under this Agreement or
otherwise, if any, accruing after the termination of the Employment Period will cease upon
such termination.
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Notwithstanding the foregoing, if such termination is a result of a Permanent Disability or if the
Employment Period Is terminated as a result of an Unjustified Termination, the Executive shall
continue to receive his major medical insurance coverage benefits from the Company's plan in
effect from time to time (provided the Executive continues to pay the portion of the premiums
for such coverage that are charged to similarly situated active employees) for a period equal to
the lesser of (i) twelve (12) months after the Date of Termination, and (ii) until the Executive is
provided by another employer with benefits substantially comparable (with no pre-existing
condition limitations) to the benefits provided by such plan. The continuation of such benefits
under this Section shall only be available if the Executive has fully complied with and continues
to fully comply with the provisions of Sections 6.01, 7.01, 8.01, 9.01 or 9.02 of this Agreement.
SECTION 5.05. Notice of Termination and Opportunity to Cure. Any termination by the
Company for Permanent Disability or Cause or without Cause or by the Executive for Good Reason
shall be communicated by written Notice of Termination to the other party hereto. For purposes
of this Agreement, a "Notice of Termination" shall mean a notice which shall Indicate the
date the
termination is to take effect (consistent with the terms of this Agreement), the specific termination
provision in this Agreement relied upon and, for a termination for Permanent Disability or for
Cause or for a resignation for Good Reason, shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of employment under the provision
indicated. It shall be a condition precedent to the Executive's right to terminate employment for
Good Reason that (i) the Executive shall first have given the Company written notice that an event
or condition constituting Good Reason has occurred within ninety (90) days after such occurrence,
and any failure to give such written notice within such period will result in a waiver by the
Executive of his right to terminate for Good Reason as a result of such event or condition, and (ii) a
period of thirty (30) days from and after the giving of such written notice shall have elapsed
without the Company having effectively cured or remedied such occurrence during such 30-day
period, unless such occurrence cannot be cured or remedied within thirty (30) days, in which case
the period for remedy or cure shall be extended for a reasonable time (not to exceed an additional
fifteen (15) days) provided that the Company has made and continues to make a diligent effort to
effect such remedy or cure.
SECTION 5.06. Date of Termination. "Date of Termination" shall mean (a) If the
Employment Period Is terminated as a result of a Permanent Disability, five (5) days after a Notice
of Termination is given, (b) if the Employment Period is terminated by the Executive for Good
Reason, the date specified in the Notice of Termination consistent with the terms hereof, (c) if the
Employment Period terminates due to expiration of the term of this Agreement, the date the term
expires, and (d) if the Employment Period is terminated for any other reason (including for Cause),
the date designated by the Company in the Notice of Termination.
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ARTICLE 6
CONFIDENTIAL INFORMATION
SECTION 6.01. Nondisclosure and Nonuse of Confidential Information. The Executive
will not disclose or use at any time during or after the Employment Period any Confidential
Information of which the Executive is or becomes aware, whether or not such information is
developed by him, except to the extent that such disclosure or use is directly related to and
required by the Executive's performance of duties assigned to the Executive pursuant to this
Agreement. Under all circumstances and at all times, the Executive will take all reasonably
appropriate steps to safeguard Confidential Information in his possession and to protect it
against disclosure, misuse, espionage, loss and theft. If the Executive is compelled by court or
administrative order to disclose information that would otherwise be considered Confidential
Information, the Executive will first give the Company prompt written notice of any such
requirement, disclose no more information than is so required in the opinion of competent
legal counsel, and cooperate fully with any efforts by the Company to obtain a protective order
or similar confidentiality treatment for such information. Nothing in this Agreement, however,
or any other agreement or arrangement with the Company or any of its Affiliates shall require
the Executive to give notice to the Company prior to the Executive making any disclosure of
information or documents to any governmental agency or legislative body, any self-regulatory
organization, the Legal Department of the Company, and/or pursuant to the whistleblower
provisions of the Dodd-Frank Act or Sarbanes-Oxley Act.
SECTION 6.02. Defend Trade Secrets Act. Pursuant to 18 U.S.C. § 1833(b), the
Executive understands that the Executive will not be held criminally or civilly liable under any
Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) Is
made (x) in confidence to a Federal, State, or local government official, either directly or
Indirectly, or to the Executive's attorney and (y) solely for the purpose of reporting or
Investigating a suspected violation of law; or (ii) Is made in a complaint or other document
that is filed under seal in a lawsuit or other proceeding. The Executive understands that if the
Executive files a lawsuit for retaliation by the Company for reporting a suspected violation of
law, the Executive may disclose the trade secret to the Executive's attorney and use the trade
secret information in the court proceeding if the Executive (I) files any document containing
the trade secret under seal, and (II) does not disclose the trade secret, except pursuant to
court order. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or
create liability for disclosures of trade secrets that are expressly allowed by such section.
Further, nothing in this Agreement or any other agreement or arrangement with the Company
or any of its Affiliates shall prohibit or restrict the Executive from making any disclosure of
information or documents to any governmental agency or legislative body, any self-regulatory
organization, the Legal Department of the Company, and/or pursuant to the whistleblower
provisions of the Dodd-Frank Act or Sarbanes-Oxley Act.
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ARTICLE 7
INTELLECTUAL PROPERTY
SECTION 7.01. Ownership of Intellectual Property. In the event that the Executive as
part of his activities on behalf of the Company or its Affiliates generates, authors or
contributes to any invention, design, new development, device, product, method of process
(whether or not patentable or reduced to practice or comprising Confidential Information), any
copyrightable work (whether or not comprising Confidential Information) or any other form of
Confidential Information relating directly or indirectly to the business of the Company or its
Affiliates as now or hereinafter conducted (collectively, "Intellectual Property"), the
Executive acknowledges that such Intellectual Property is the sole and exclusive property of
the Company and its Affiliates and hereby assigns all right title and interest in and to such
Intellectual Property to the Company and its Affiliates. Any copyrightable work prepared in
whole or in part by the Executive during employment with the Company will be deemed "a
work made for hire" under Section 201(b) of the United States Copyright Act of 1976, as
amended, and the Company and its Affiliates will own all of the rights comprised in the
copyright therein. The Executive will promptly and fully disclose all Intellectual Property and
will cooperate with the Company and its Affiliates to protect the interests of the Company and
its Affiliates in and rights to such Intellectual Property (including providing reasonable
assistance in securing patent protection and copyright registrations and executing all
documents as reasonably requested by the Company or its Affiliates, whether such requests
occur prior to or after termination of the Executive's employment hereunder).
ARTICLES
DELIVERY OF MATERIALS UPON TERMINATION OF EMPLOYMENT
SECTION 8.01. Delivery of Materials upon Termination of Employment. As requested
by the Company from time to time and upon the termination of the Executive's employment
with the Company for any reason, the Executive will promptly deliver to the Company all
property of the Company and its Affiliates in the Executive's possession or within his control,
including, without limitation, all copies and embodiments, in whatever form or medium, of all
Confidential Information or Intellectual Property (including written records, notes,
photographs, manuals, notebooks, documentation, program listings, flow charts, magnetic
media, disks, diskettes, tapes and all other materials containing any Confidential Information or
Intellectual Property), irrespective of the location or form of such property and, if requested by
the Company, will provide the Company with written confirmation that all such property have
been delivered to the Company.
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ARTICLE 9
NONCOMPETITION AND NONSOLICITATION
SECTION 9.01. Noncompetition. The Executive acknowledges that during his
employment with the Company, he will become familiar with trade secrets and other
Confidential Information concerning the Company and its Affiliates and their respective
predecessors, and that his services will be of special, unique and extraordinary value to the
Company. In addition, the Executive hereby agrees that during the Noncompetition Period, he
will not directly or indirectly own, manage, control, participate in, be employed by, consult
with, render services for, provide work for, become associated with, or in any manner engage in
any Restricted Business in the Restricted Area. With respect to the twelve (12) month period
after the Executive's employment ends, the restriction on work only applies to the Executive
providing executive level services, whether as an employee or independent contractor, or
otherwise providing work or services in an executive level position.
For purposes of this Agreement, the "Noncompetition Period" shall mean the
Employment Period, together with any period following the Employment Period during which
the Executive remains an employee of the Company or Its Affiliate, and the period of twelve
(12) months following termination of the Executive's employment for any reason;
provided, however, that if the Executive's termination of employment occurs as
a result of the Executive's resignation or leaving of his employment other than for Good
Reason or at the end of the Employment Period as a result of the Executive's provision
of written notice not to extend the Employment Period under Section 5.01, except as
provided in clause (Y) below, the Noncompetition Period shall continue beyond such
termination of employment only if (i) the Company pays the Executive, for each day
during which the Noncompetition Period so continues, an amount equal to 1/365th of
the sum of (I) the Executive's annual Base Salary, plus (II) his Bonus Amount for the
calendar year of such termination of employment, and (Ill) a pro-rated portion of the
Executive's Bonus Amount based on the number of days elapsed in the calendar year
through the Date of Termination, such amount to be paid in accordance with the regular
payroll practices of the Company (except that any amount otherwise payable prior to
the sixtieth (60th) day following the termination date shall instead be paid on such
sixtieth (60th) day); and (ii) the Executive shall continue to receive his major medical
insurance coverage benefits from the Company's plan in effect from time to time
(provided the Executive continues to pay the portion of the premiums for such coverage
that are charged to similarly situated active employees) for a period equal to the lesser
of (x) the end of the Noncompetition Period, and (y) until the Executive is provided by
another employer with benefits substantially comparable (with no pre-existing
condition limitations) to the benefits provided by such plan; and provided further,
however, that:
(X)the Company may elect, in its sole discretion, by written notice to the
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Executive given not more than ten (10) business days after the date the Executive's
employment terminates, to reduce the Noncompetition Period under such
circumstances so that it ends on the date set forth in such written notice (which shall
not be later than twelve (12) months after the termination date), in which case the
Company's obligation to make payments and provide benefits under this Section 9.01
shall end at the end of the Noncompetition Period, and
(Y)the Company's requirement to make payments under this Section
9.01as a condition to continuation of the Noncompetition Period shall apply only If the
Executive has entered into a general release of claims reasonably satisfactory to the
Company on or before the date that Is fifty (50) days following the Date of Termination
and does not revoke such release prior to the end of the statutory seven (7) day
revocation period (it being understood that such general release will not require the
Executive to release his rights under this Section 9.01 and will not contain any
employment restrictions or non-solicitation obligations other than those set forth in
this Agreement) and the Executive has fully complied with and continues to fully
comply with the provisions of Sections 6.01, 7.01, 8.01, 9.01, 9.02 or 10.01 hereof.
For the avoidance of doubt, amounts shall not be payable under both this Section 9.01
and Section 5.02. The Executive understands and agrees that should the Executive fail to fully
comply with any of the obligations specified in Sections 6.01, 7.01, 8.01, 9.01, or 9.02 hereof, It
will result In a forfeiture of any compensation and benefits to which the Executive may
otherwise be entitled pursuant to clauses (A), (B), and (C) of Section 5.02 of this Agreement or
Section 9.01of this Agreement.
"Restricted Business" means (i) providing services or products relating to mortgage
insurance or reinsurance, (ii) any business competing with the business(es) of the Company or
its Affiliates as such business(es) exist as of the date of the Executive's termination (for any
reason), (iii) any business competing with the business(es) that were conducted by the
Company or its Affiliates at any time during the twelve (12) months prior to the Executive's
termination (for any reason); or (iv) any business competing with the business(es) that were
being actively developed by the Company or its Affiliates and with which the Executive was
involved to a material extent during the twelve (12) months prior to termination of the
Executive's employment (for any reason). This restriction only applies to businesses of the
Company or its Affiliates with which the Executive was materially involved or for which the
Executive had access to confidential information.
"Restricted Area" consists of the areas specified in Appendix A attached hereto.
The parties acknowledge that the Company engages in and actively seeks business
throughout the United States and that the Company's Affiliates engage in and actively seek
business throughout the world. The parties further acknowledge that the Executive will have
access to confidential information relating to all of the Company's Affiliates and regularly
participate in strategic business discussions and decisions relating to the Company's Affiliates.
Thus, a worldwide restriction is necessary to protect the legitimate business interests of the
Company and its Affiliates.
The Executive hereby acknowledges that the period of time, scope, and territory relating
to this noncompetition provision are reasonable and necessary for the protection of the
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Company in the operation of business and do not unduly restrict the Executive's ability to
provide for himself and/or his family during the Noncompetition Period or to pursue adequate
employment opportunities.
It shall not be considered a violation of this Section 9.01 for the Executive to be a
passive owner of not more than 2% of the outstanding stock of any class of a corporation which
is publicly traded, so long as the Executive has no active participation in the business of such
corporation.
SECTION 9.02. Nonsolicitation. The Executive acknowledges that during his
employment with the Company, he will become familiar with trade secrets and other
Confidential Information concerning the Company, Its Affiliates and their respective
predecessors, and that his services will be of special, unique and extraordinary value to the
Company. The Executive hereby agrees that during the Employment Period, together with
any period following the Employment Period during which the Executive remains an employee
of the Company or its Affiliate, and for a period of one (1) year after the date of termination of
employment for any reason (the "Nonsolicitation Period"), the Executive will not, directly or
Indirectly:
(i)solicit, induce, or attempt to solicit or Induce any Relevant Employee
of the Company to leave the employ of the Company, for any reason whatsoever;
(ii)solicit, Induce, or attempt to solicit or Induce any Relevant Employee
of one of the Company's Affiliates to leave the employ of that Affiliate, for any
reason whatsoever;
(iii)in any way disrupt or interfere with the relationship, contractual or
otherwise between the Company and any Relevant Employee thereof;
(iv)in any way disrupt or interfere with the relationship, contractual or
otherwise between one of the Company's Affiliates and any Relevant Employee thereof;
or
(v)hire, employ, or receive the work or services of any Relevant Employee
which are the same or similar to the work or services that Relevant Employee provided
to the Company or its Affiliates.
For purposes of this Agreement, a "Relevant Employee" shall mean any individual who
was employed with the Company or any Affiliate of the Company as a director, officer,
executive, underwriter or manager at any time during the twelve (12) month period prior to the
termination of the Executive's employment (for any reason) and with whom the Executive had
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contact during the Executive's employment with the Company or became aware of as a result
of the Executive's employment with the Company.
The Executive further agrees that during the Nonsolicitation Period, the Executive will
not, directly or Indirectly:
(i)solicit, induce, or attempt to solicit or induce any Restricted Customer
to cease doing business with the Company; or
(ii)solicit, induce, or attempt to solicit or induce any Restricted Customer
to cease doing business with any Affiliate of the Company.
For purposes of this Agreement, a "Restricted Customer" shall mean any firm,
company, or Person who was a customer, investor, supplier, client, Insured, reinsured,
reinsurer, broker, agent, licensee or other business relation of the Company or any of Its
Affiliates at any time during the twelve (12) month period prior to the termination of the
Executive's employment (for any reason) and with whom the Executive had contact during the
Executive's employment with the Company or became aware of as a result of the Executive's
employment with the Company.
SECTION 9.03. Enforcement. If, at the enforcement of Section 9.01 or 9.02, a court
holds that the duration, territory, or scope stated therein are unreasonable under
circumstances then existing, the parties agree that the maximum duration, territory, and
scope reasonable under such circumstances will be substituted for the stated duration or
scope and it is the parties' intention that the court will revise the restrictions contained in
this Article 9 to cover the maximum duration and scope permitted by law.
ARTICLE 10
EQUITABLE RELIEF
SECTION 10.01. Injunctive or Other Equitable Relief. The Executive acknowledges that
(a) the covenants contained herein are reasonable, (b) the Executive's services are unique,
and (c) a breach or threatened breach by him of any of his covenants and agreements with
the Company and its Affiliates contained in Sections 6.01, 7.01, 8.01, 9.01 or 9.02 could
cause irreparable harm to the Company or its Affiliates for which they would have no
adequate remedy at law. Accordingly, and in addition to any remedies which the Company
and its Affiliates may have at law, in the event of an actual or threatened breach by the
Executive of his covenants and agreements contained in Sections 6.01, 7.01, 8.01, 9.01 or
9.02, the Company and its Affiliates shall have the absolute right, without the need to post
a bond or any other type of security, to commence a lawsuit or other proceeding in any
court of competent jurisdiction (the "Selected Court") seeking injunctive or other equitable
relief (an "Injunction Proceeding"). In furtherance thereof, the Executive expressly and
irrevocably agrees that the Selected Court may exercise personal jurisdiction over him in
connection with any Injunction
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Proceeding and further agrees not to assert that any court other than the Selected Court is a
more suitable forum for an Injunction Proceeding.
ARTICLE 11
EXECUTIVE REPRESENTATIONS
SECTION 11.01. Executive Representations. The Executive hereby represents and
warrants to the Company that (a) the execution, delivery and performance of this Agreement
by the Executive does not and will not conflict with, breach, violate or cause a default under
any contract, agreement, instrument, order, judgment or decree to which the Executive is a
party or by which he is bound, (b) the Executive Is not a party to or bound by any employment
agreement, noncompetition agreement or confidentiality agreement with any other Person
that affects his right or ability to perform the duties contemplated by this Agreement, and (c)
upon the execution and delivery of this Agreement by the Company, this Agreement will be
the valid and binding obligation of the Executive, enforceable in accordance with its terms.
ARTICLE 12
MISCELLANEOUS
SECTION 12.01. Remedies. The Company will have all rights and remedies set forth
in this Agreement, all rights and remedies which the Company has been granted at any time
under any other agreement or contract and all of the rights which the Company has under
any law. The Company will be entitled to enforce such rights specifically, without posting a
bond or other security, to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law. There are currently no
disciplinary or grievance procedures in place, there is no collective agreement in place, and
there is no probationary period.
SECTION 12.02. Consent to Amendments. The provisions of this Agreement may be
amended or waived only by a written agreement executed and delivered by the Company
and the Executive. No other course of dealing between the parties to this Agreement or any
delay In exercising any rights hereunder will operate as a waiver of any rights of any such
parties.
SECTION 12.03. Successors and Assigns. All covenants and agreements contained in
this Agreement by or on behalf of any of the parties hereto will bind and inure to the benefit
of the respective successors and assigns of the parties hereto whether so expressed or not,
provided that the Executive may not assign his rights or delegate his obligations under this
Agreement without the written consent of the Company.
SECTION 12.04. Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable law, but if
any provision of this Agreement is held to be prohibited by or invalid under applicable law,
such
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provision will be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.
SECTION 12.05. Counterparts. This Agreement may be executed simultaneously in
two counterparts, any one of which need not contain the signatures of more than one party,
but all of which counterparts taken together will constitute one and the same agreement.
SECTION 12.06. Descriptive Headings. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this Agreement.
SECTION 12.07. Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in writing and shall be
delivered personally by hand, by electronic transmission (with a copy following by hand or by
overnight courier), by registered or certified mail, postage prepaid, return receipt requested, or
by overnight courier service (charges prepaid). Communications delivered personally by hand
shall be deemed received on the date when delivered personally to the recipient;
communications sent by electronic means shall be deemed received one (1) business day
after the sending thereof; communications sent by registered or certified mail shall be deemed
received four (4) business days after the sending thereof; and communications delivered by
overnight courier shall be deemed received one (1) business day after the date when sent to
the recipient. Such notices, demands and other communications will be sent to the Executive
and to the Company at the addresses set forth below.
If to the
Executive:
To the last address delivered to the Company by the
Executive in the manner set forth herein.
If to the
Company:
Arch U.S. MI Services Inc.
230 N. Elm St
Greensboro NC 27401
Attn: General Counsel
or to such other address or to the attention of such other person as the recipient party has
specified by prior written notice to the sending party.
SECTION 12.08. Withholding. The Company may withhold from any amounts
payable under this Agreement such federal, state, local or foreign taxes as shall be required to
be withheld pursuant to any applicable law or regulation.
SECTION 12.09. Sections 409A. It is intended that this Agreement will comply with
Sections 409A of the Internal Revenue Code of 1986, as amended (the "Code") (and any
regulations and guidelines issued thereunder), to the extent the Agreement is subject thereto,
and the Agreement shall be interpreted on a basis consistent with such intent. If an
amendment of the Agreement is necessary in order for it to comply with Section 409A, the
parties hereto will negotiate in good faith to amend the Agreement in a manner that preserves
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the original intent of the parties to the extent reasonably possible. No action or failure to act,
pursuant to this Section 12.09 shall subject the Company to any claim, liability, or expense,
and the Company shall not have any obligation to indemnify or otherwise protect the
Executive from the obligation to pay any taxes, interest or penalties pursuant to Section 409A
of the Code.
Notwithstanding any provision to the contrary in this Agreement, if the Executive is
deemed on the date of his "separation from service" (within the meaning of Treasury
Regulation Section 1.409A-l(h)) to be a "specified employee" within the meaning of that term
under Section 409A(a)(2)(B) of the Code, then with regard to any payment that is required to be
delayed pursuant to Section 409A(a)(2)(B) of the Code (after taking into account the applicable
provisions of Treasury Regulation Section 1.409A-l(b)(9)(iii)), the portion, if any, of such
payment so required to be delayed shall not be made prior to the earlier of (i) the expiration of
the six (6)-month period measured from the date of his "separation from service" or (ii) the
date of his death (the "Delay Period''). Upon the expiration of the Delay Period, all
payments and benefits delayed pursuant to this Section (whether they would have otherwise
been payable in a single sum or in installments in the absence of such delay) shall be paid or
reimbursed to the Executive in a lump sum, and any remaining payments due under this
Agreement shall be paid In accordance with the normal payment dates specified for them
herein. Whenever payments under this Agreement are to be made in Installments, each such
Installment shall be deemed to be a separate payment for purposes of Section 409A of the
Code. Notwithstanding any provision of this Agreement to the contrary, for purposes of any
provision of this Agreement providing for the payment of any amounts or benefits upon or
following a termination of employment that are considered deferred compensation under
Section 409A, references to the Executive's "termination of employment" (and corollary terms)
with the Company shall be construed to refer to the Executive's "separation from
service" (within the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company. In no
case will compliance with this Section by the Company constitute a breach of the Company's
obligations under this Agreement.
With respect to any reimbursement or in-kind benefit arrangements of the Company
and its subsidiaries that constitute deferred compensation for purposes of Section 409A,
except as otherwise permitted by Section 409A, the following conditions shall be applicable:
(i) the amount eligible for reimbursement, or in-kind benefits provided, under any such
arrangement in one calendar year may not affect the amount eligible for reimbursement, or In-
kind benefits to be provided, under such arrangement in any other calendar year (except that
the health and dental plans may impose a limit on the amount that may be reimbursed or
paid), (ii) any reimbursement must be made on or before the last day of the calendar year
following the calendar year in which the expense was Incurred, and (iii) the right to
reimbursement or in-kind benefits is not subject to liquidation or exchange for another
benefit.
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SECTION 12.10. Excess Parachute Payments.
(a)Notwithstanding any other provision of this Agreement, in the event that the
amount of payments or other benefits payable to the Executive under this Agreement
(including, without limitation, the acceleration of any payment or the accelerated vesting of any
payment or other benefit), together with any payments, awards or benefits payable under any
other plan, program, arrangement or agreement maintained by the Company or one of its
Affiliates, would constitute an "excess parachute payment" (within the meaning of Section
280G of the Code), the payments under Section 5.02 of this Agreement shall be reduced (by
the minimum possible amounts) until no amount payable to the Executive under this
Agreement constitutes an "excess parachute payment" (within the meaning of Section 280G
of the Code); provided. however. that no such reduction shall be made if the net after-tax
payment (after taking Into account federal. state, local or other income. employment and
excise taxes) to which the Executive would otherwise be entitled without such reduction
would be greater than the net after-tax payment (after taking into account federal. state. local
or other income, employment and excise taxes) to the Executive resulting from the receipt of
such payments with such reduction.
(b)All determinations required to be made under this Section 12.10, including
whether a payment would result in an "excess parachute payment" and the assumptions to be
utilized in arriving at such determinations, shall be made by a nationally recognized accounting
or consulting firm designated by the Company (the "Accounting Firm") which shall provide
detailed supporting calculations both to the Company and the Executive as requested by the
Company or the Executive. All fees and expenses of the Accounting Firm shall be borne solely
by the Company and shall be paid by the Company. Absent manifest error, all determinations
made by the Accounting Firm under this Section 12.10 shall be final and binding upon the
Company and the Executive.
SECTION 12.11. No Third Party Beneficiary. This Agreement will not confer any rights
or remedies upon any person other than the Company and its Affiliates, the Executive and
their respective heirs, executors, successors and assigns.
SECTION 12.12. Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement among the parties and supersedes any
prior understandings, agreements or representations by or among the parties, written or oral,
that may have related in any way to the subject matter hereof. Including, without limitation,
the Employment Agreement dated as of , between the Company and the
Executive.
SECTION 12.13. Construction. The language used in this Agreement will be deemed to
be the language chosen by the parties to express their mutual intent, and no rule of strict
construction will be applied against any party. Any reference to any federal, state, local or
foreign statute or law will be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The use of the word "including" in this
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Agreement means including without limitation and is intended by the parties to be by way of
example rather than limitation.
SECTION 12.16. Survival. Sections 5.02, 5.04, 6.01, 6.02, 7.01, 8.01 and Articles 9, 10, 11
and 12 will survive and continue in full force in accordance with their terms notwithstanding
any termination of the Employment Period.
SECTION 12.17. GOVERNING LAW. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDlTY AND INTERPRETATION OF THIS AGREEMENT WILL BE
GOVERNED BV THE INTERNAL LAW OF NORTH CAROLINA, WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.
SECTION 12.18. Arbitration. Except when the Company or its Affiliates exercise their
right to seek Injunctive or other equitable relief pursuant to Section 10.01 above, all disputes
between the parties arising out of, In connection with or concerning this Agreement or any
share-based award agreements between the Company and the Executive (collectively, the
"Disputes") shall be adjudicated in a confidential private arbitration to be conducted In
accordance with the comprehensive rules and procedures of JAMS (the "JAMS Rules"),
Including, but not limited to, the Internal appeal process provided for In JAMS Rule 34 (the
"Arbitration"). The Arbitration shall be conducted before a panel of three arbitrators (the
"Panel"), one appointed by the Company, another appointed by the Executive and the third
appointed by the other two arbitrators (or, if the two arbitrators cannot agree, the third
arbitrator shall be appointed by JAMS). Subject to the JAMS Rules, in-person hearings in the
arbitration shall be held In Wake County, State of North Carolina, and shall be conducted in
English. The parties shall each pay fifty percent (50%) of the Panel's fees and other costs billed
to the parties by JAMS for the Arbitration. Notwithstanding the immediately preceding
sentence, each of the parties shall pay its own attorneys' fees and costs incurred in connection
with the Arbitration. The Panel shall have no authority to render an award that requires either
of the parties to pay the attorneys' fees or costs incurred by the other party in connection with
the Arbitration or otherwise. A Judgment upon a final award rendered by the Panel, after
giving effect to the JAMS internal appeal process, may be sought and entered in any court
having jurisdiction thereof (an "Enforcement Proceeding"). If JAMS is not in business or is no
longer providing arbitration services, then the American Arbitration Association shall be
substituted for JAMS for the purposes of this Section 12.18. Each party shall maintain the
confidentiality of the Arbitration (including any award rendered therein), except as necessary in
connection with an Enforcement Proceeding or as otherwise required by law.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.
ARCH U.S. MI SERVICES INC.
By: /s/ David Gansberg
Name: David Gansberg
Title: Executive Chairman, Arch U.S. MI Services
Date: 5/1/2019
/s/ Michael Schmeiser
Michael Schmeiser
Date: 4/23/19
Exhibit 31.1

Certification
of Chief Executive Officer
Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
I, Nicolas Papadopoulo, certify that:
1.    I have reviewed this quarterly report on Form 10-Q of Arch Capital Group Ltd.;
2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in the report;
4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date:November 4, 2026
By:/s/ Nicolas Papadopoulo
Name:Nicolas Papadopoulo
Title:Chief Executive Officer
Exhibit 31.2

Certification
of Chief Financial Officer
Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
I, François Morin, certify that:
1.     I have reviewed this quarterly report on Form 10-Q of Arch Capital Group Ltd.;
2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in the report;
4.     The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.     Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.     Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.     Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.     All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date:November 4, 2026
By:/s/ François Morin
Name:François Morin
Title:Executive Vice President, Chief Financial Officer and Treasurer
Exhibit 32.1
Certification Pursuant to Chapter 63, Title 18 United States Code §1350
As Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    In connection with the Quarterly Report of Arch Capital Group Ltd. (the “Company”) on Form 10-Q for the period ending September 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Nicolas Papadopoulo, as Chief Executive Officer of the Company, certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)    the Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; and
(2)    the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date:November 4, 2026
By:/s/ Nicolas Papadopoulo
Name:Nicolas Papadopoulo
Title:Chief Executive Officer
A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Arch Capital Group Ltd. and will be retained by Arch Capital Group Ltd. and furnished to the Securities and Exchange Commission or its staff upon request.
Exhibit 32.2

Certification Pursuant to Chapter 63, Title 18 United States Code §1350
As Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    In connection with the Quarterly Report of Arch Capital Group Ltd. (the “Company”) on Form 10-Q for the period ending September 30, 2026 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), François Morin, as Executive Vice President, Chief Financial Officer and Treasurer of the Company, certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)    the Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; and
(2)    the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date:November 4, 2026
By:/s/ François Morin
Name:François Morin
Title:Executive Vice President, Chief Financial Officer and Treasurer
A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Arch Capital Group Ltd. and will be retained by Arch Capital Group Ltd. and furnished to the Securities and Exchange Commission or its staff upon request.