Kingstone Companies Inc. (NASDAQ: KINS) reported record financial performance for 2025 and announced plans to enter California's excess and surplus lines homeowners insurance market in the second quarter of 2026.

The Northeast regional property and casualty insurer posted net income of $40.8 million in 2025, more than double the previous year's figure. Diluted earnings per share increased 95% to $2.88, while the combined ratio improved to 75%, generating a 43% return on equity. Direct premiums written grew 39% since year-end 2023.

CEO Meryl Golden said in a shareholder letter that the company has transformed from an underperforming business with a 41% net expense ratio four years ago into a focused and profitable operation. The company reduced its footprint in unprofitable states, changed its product and risk appetite, and restructured its cost base.

Kingstone outlined a five-year growth plan to reach $500 million in written premium by 2029, doubling its current size through organic growth in New York and expansion into new markets. California represents the first expansion state, with the company targeting the excess and surplus lines market where carriers face less regulation than admitted carriers.

The company cited California's $15 billion homeowners market size and regulatory constraints on admitted carriers as key factors in its decision. Admitted carriers face prolonged rate approval processes and restrictions on catastrophe modeling, leading to capacity constraints. The excess and surplus lines market grew 32% in 2025 and now represents 7% of California's total homeowners market.

Kingstone projects California will represent less than 5% of 2026 premium, with New York remaining more than 95% of its business. The company has placed a 30% quota share on all California business and plans to target low-to-moderate wildfire exposure properties.

The insurer will use market-leading wildfire models for risk assessment and rating, focusing on instant quoting and binding capabilities for agents. Kingstone's 30% expense ratio provides a structural advantage over competitors, according to the company.