Crawford & Company Navigates Mixed US Weather with Strong International Gains

The insurance landscape is a delicate ecosystem, influenced by myriad factors including weather patterns, regulatory changes, and market demands. In the second quarter of 2026, Crawford & Company, a leading claims management firm based in Atlanta, exemplified this dynamic as it reported a remarkable recovery in its international operations, juxtaposed against a challenging domestic claims environment. This contrasting performance not only underscores the variability in insurance claims driven by weather but also highlights broader implications for brokers and stakeholders within the industry.

For the three months ending June 30, Crawford reported revenues before reimbursements of $321.4 million, which remained largely unchanged from $323 million in the same period of 2025. However, the company's net income attributable to shareholders saw a substantial increase of 73%, rising to $13.4 million from $7.8 million the previous year. This uptick in profitability was largely driven by the company's international segment, which reported operating earnings of $10.9 million, a 48.2% surge from $7.3 million in Q2 2025. Such figures not only reflect a robust growth trajectory but also signal a strategic pivot towards international markets that have been more resilient amidst variable weather conditions.

International Markets Shine Amid US Softness

Crawford's international operations emerged as the standout performer in the second quarter, driven by increased weather-related activity in regions such as Australia and Asia. The operating margin for this segment expanded from 5.5% to 7.9%, showcasing the efficiency and effectiveness of Crawford's strategic initiatives abroad. Year-to-date, international operating earnings reached $14.9 million, a 55.6% increase from $9.6 million in the first half of 2025.

Notably, the UK accounts for approximately 13.4% of Crawford's total revenue, making it the second-largest contributor after the US. However, this segment also saw changes with the recent sale of Crawford Legal Services operations in the UK and Chile, resulting in a net loss of $1.3 million. This divestiture means that brokers who previously utilized these legal services will now have to seek alternative sources, impacting their operations and possibly leading to increased costs.

The US Claims Environment: A Different Story

In stark contrast to its international success, Crawford's US Property & Casualty (P&C) segment experienced a significant downturn. The segment's revenue declined by 10.2%, falling to $74.1 million from $82.5 million in Q2 2025. This downturn can be attributed to several factors, including a reduction in weather-related claims, decreased staffing for catastrophe services, and fewer contractor referrals.

This trend of softening claims has been apparent since the beginning of the year. In Q1 2026, US P&C revenues dropped 11.3%, with Crawford's President and CEO Bruce Swain attributing this to an “extended period of benign weather.” The implications of such a prolonged lack of severe weather events are substantial, particularly when considering Gallagher Re's H1 2026 Natural Catastrophe and Climate Report, which noted global insured catastrophe losses of $46 billion, a staggering 28% below the 10-year average.

Impact on Reinsurance Pricing

The benign weather activity has cascading effects throughout the insurance market, particularly influencing property reinsurance pricing. According to the Guy Carpenter global property catastrophe rate-on-line index, rates have seen a significant drop of 16% during the July 2026 midyear renewal period. This decrease reflects the broader trends of reduced claims and the resultant pricing adjustments that brokers and insurers must navigate.

Broadspire Segment Shows Stability

Amid these mixed results, Crawford's Broadspire segment, responsible for third-party claims administration, exhibited steadiness in performance. Revenues increased by 1.2% to $109.4 million, with operating earnings climbing to $15.7 million from $14.2 million. This stability, characterized by an improved operating margin of 14.4%, can be attributed to growth in disability claims and medical management revenues.

Overall, consolidated adjusted operating earnings rose by 34% to $29.4 million in Q2 2026, compared to $22 million in the prior year. Adjusted EBITDA also saw a 20% increase, reaching $37.6 million from $31.4 million. Swain noted that this quarter represented a significant rebound from a slower start to the year, fueled by weather-related claims volume in international markets and continued solid results from Broadspire.

Strategic Investments and Future Outlook

Looking ahead, Crawford remains committed to maintaining a robust pipeline for new business opportunities, having secured nearly $22 million in new contracts during Q2. This proactive approach is crucial as the company navigates the challenges posed by varying claims environments across its operational geographies.

In a sign of confidence in its financial health, Crawford's board approved an increase to the quarterly dividend, raising it to $0.08 per share from the previous $0.075. The company also reported a cash position of $69.4 million as of June 30, up from $64.1 million at the end of 2025. However, total debt rose to $198.1 million from $189.1 million, highlighting the balancing act of managing growth while ensuring fiscal responsibility.

Key Takeaways

• International Operations Thrive: Crawford's international segment reported a 48.2% increase in operating earnings, driven by favorable weather conditions in key regions.
• US Market Challenges: The US P&C segment faced a 10.2% revenue decline due to lower weather-related claims and staffing reductions.
• Reinsurance Pricing Drops: Property reinsurance rates decreased by 16%, reflecting the sustained period of benign weather affecting claims.
• Broadspire Stability: The third-party claims administration segment showed growth in revenue and earnings, indicating resilience.
• Strategic Focus on Growth: Crawford is maintaining an active pipeline and increasing dividends, showcasing confidence in future performance.

Frequently Asked Questions

What factors contributed to Crawford's international success?

Crawford's international success can be attributed to increased weather-related activity in regions like Australia and Asia, which drove demand for claims management services. Additionally, the company's strategic focus on expanding its presence in these markets has resulted in improved operating margins and overall earnings growth.

How does the US claims environment impact Crawford's overall performance?

The US claims environment has a significant impact on Crawford's overall performance, particularly in its P&C segment. The recent downturn, characterized by lower weather-related claims and fewer catastrophe services, has led to revenue declines. This impact is compounded by broader market trends that affect pricing and operational capacity, making it essential for the company to adapt its strategies accordingly.

What are the implications of reduced reinsurance pricing for brokers?

Reduced reinsurance pricing, as seen in the recent 16% decline, can have several implications for brokers. It may lead to lower costs for insurers, but it could also signal a softening market that may affect profitability in the long term. Brokers must navigate these dynamics carefully, balancing competitive pricing with the need for sustainable margins.

What is Crawford's strategy for future growth?

Crawford's strategy for future growth centers on maintaining a strong pipeline of new business opportunities while continuing to invest in its international operations. The company aims to leverage its strengths in claims management across diverse markets, focusing on resilience and adaptability to changing market conditions.