Consolidated operating income for Q2 2025 was $1.1 billion, up from $410 million in Q2 2024, driven largely by unrealized gains on the equity portfolio.
Expense ratio increased to 36.3% from 34.5% due to severance, professional fees, and controllable expense increases, with a commitment to reduce controllable expenses over time.
Favorable reserve development of 6 points was reported in the first half of 2025 despite reserve strengthening in runoff lines.
Gross written premiums in Markel Insurance were down 2% in Q2 2025 but net earned premiums were up 3%, reflecting underwriting actions to improve profitability.
Investments operating income rose to $822 million in Q2 2025 from $100 million a year ago, with a 5.4% return on the equity portfolio and $597 million in mark-to-market gains.
Markel Group shares have compounded at an annual growth rate of over 16% over the last 5 years.
Markel Insurance combined ratio was 96.9% in Q2 2025 versus 93.8% a year ago, impacted by adverse development in discontinued product lines and runoff businesses.
Markel Insurance operating income declined to $128 million in Q2 2025 from $177 million a year ago due to less favorable prior year loss development and a higher expense ratio.
Markel Ventures funded all capital expenditures internally and generated cash for share repurchases and other uses.
Markel Ventures revenues increased 7% to $1.55 billion in Q2 2025, with operating income up 17% to $208 million, driven by acquisitions and growth in construction services.
Net investment income was $228 million in Q2 2025, slightly up from $220 million in Q2 2024, with fixed income yields improving but moderated by lower short-term interest rates.
Average occupancy increased by 10 basis points, average effective monthly rents increased by 90 basis points, and bad debt improved by 20 basis points compared to the prior year.
Core FFO per share was $0.28 in Q2 2025, up from $0.27 in Q1 2025.
Noncontrollable expenses declined by 3%, including an 18% reduction in property insurance premiums.
Renewal rate increases of 3.9% and 58% retention supported 70 basis points of blended rent growth in the quarter.
Same-store NOI grew 2% in the quarter, driven by a 1% increase in same-store revenue and a 60 basis point decrease in operating expenses.
Same-store operating expenses decreased 60 basis points over the prior year quarter, fully offsetting softer revenue growth.
Second quarter same-store NOI and core FFO per share results were in line with expectations, with same-store revenues increasing 1% over the prior year.
Three wholly-owned communities were classified as held for sale during the quarter, and a $10.4 million gain from a JV property sale will be recorded in Q3 but excluded from core FFO.
Dafinchi