RLI CORP Debt Disclosure
3. | DEBT |
As of December 31, 2025, outstanding debt balances totaled $100 million.
On September 15, 2023, we accessed $50 million from our revolving line of credit with PNC Bank, N.A. (PNC). The borrowing may be repaid at any time and carries an adjustable interest rate of 5.33 percent as of the end of 2025. The credit facility with PNC was entered into during the first quarter of 2023 and has a three-year term that expires on May 29, 2026. The line of credit permits us to borrow up to an aggregate principal amount of $100 million, but may be increased up to an aggregate principal amount of $130 million under certain conditions.
On November 12, 2025, we repaid $50 million that was borrowed from the Federal Home Loan Bank of Chicago (FHLBC) in 2024 and paid interest monthly at an annualized rate of 4.44 percent. Additionally, on November 12, 2025 we borrowed $50 million from the FHLBC and pay interest monthly at an annualized rate of 4.21 percent. The borrowing matures on November 12, 2026, but may be repaid early at set quarterly dates.
Due to the lack of marketability and short tenor of our borrowings, the fair value of our debt approximates the carrying value. We paid $5 million of interest on our debt in 2025, compared to $6 million in 2024 and $9 million in 2023. The average rate on debt was 5.13 percent in 2025, 6.05 percent in 2024 and 4.07 percent in 2023. The weighted average interest rate on debt outstanding was 4.77 percent as of December 31, 2025.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 18, 2022 | |
| 2020 | Feb 19, 2021 | |
| 2019 | Feb 21, 2020 | |
| 2018 | Feb 22, 2019 | |
| 2017 | Feb 23, 2018 | |
| 2016 | Feb 24, 2017 | |
| 2015 | Feb 26, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.