RLI CORP (RLI)
Sector: Financials
2026 Annual Meeting Analysis
RLI CORP · Meeting: May 14, 2026
Directors FOR
1
Directors AGAINST
9
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors
Against Analysis
Mr. Angelina has served since 2013, giving him full overlap with the 3-year period during which RLI's stock fell approximately 4% while the S&P 500 (^GSPC — S&P 500) rose about 60%, a gap of over 64 percentage points that exceeds the 30-point trigger threshold; the 5-year record does not resolve this concern as the underperformance persists over the longer window.
Mr. Duclos has served since 2017, giving him full overlap with the 3-year underperformance period; RLI's stock declined roughly 4% over three years while the S&P 500 (^GSPC — S&P 500) gained about 60%, a gap exceeding the policy trigger threshold, and the 5-year record does not adequately resolve this underperformance.
Dr. Fleming has served since 2018 with full overlap over the 3-year period in which RLI's shares lost roughly 4% against the S&P 500's (^GSPC — S&P 500) gain of about 60%, a gap of over 64 percentage points that exceeds the policy trigger; the 5-year record does not sufficiently close this gap.
Mr. Graham has served since 2004 with full tenure overlap over the underperformance period; RLI's 3-year stock return of roughly negative 4% lagged the S&P 500 (^GSPC — S&P 500) by more than 64 percentage points, well above the 30-point trigger threshold, and the 5-year comparison does not provide meaningful mitigation.
Mr. Kliethermes has been a director since 2021 with meaningful tenure overlap over the 3-year underperformance period, during which RLI's stock fell about 4% while the S&P 500 (^GSPC — S&P 500) rose about 60%; as CEO he bears direct accountability for this performance gap, and this vote against him as a director is independent of the separate Say on Pay evaluation.
Mr. Medini joined in 2022, giving him tenure that covers the majority of the 3-year underperformance window; RLI's stock return of roughly negative 4% lagged the S&P 500 (^GSPC — S&P 500) by over 64 percentage points, exceeding the trigger threshold, and the 5-year comparison does not mitigate this concern.
Mr. Restrepo has served since 2016 with full overlap over the 3-year period in which RLI's shares declined about 4% against the S&P 500's (^GSPC — S&P 500) gain of approximately 60%; this gap of over 64 percentage points exceeds the policy trigger, and the 5-year record does not resolve the underperformance.
Ms. Roberts has served since 2018 with full overlap over the 3-year underperformance period; RLI's stock lost roughly 4% while the S&P 500 (^GSPC — S&P 500) gained about 60%, a gap exceeding the 30-point trigger threshold, and the 5-year track record does not provide sufficient mitigation.
Mr. Stone has served since 2012 with full tenure overlap over the underperformance period; RLI's 3-year stock return of approximately negative 4% trailed the S&P 500 (^GSPC — S&P 500) by over 64 percentage points, well above the 30-point threshold, and the 5-year return does not close this gap sufficiently.
For Analysis
Mr. Kellogg joined the board in 2024, which is within the 24-month new-director exemption period under our policy, so he is not subject to the TSR underperformance trigger and is supported for election.
Nine of ten director nominees are subject to the TSR underperformance trigger: RLI's 3-year stock return of roughly negative 4% lagged the S&P 500 (^GSPC — S&P 500) by more than 64 percentage points, exceeding the 30-point threshold for companies with negative absolute 3-year returns. The 5-year return of approximately 20% does not provide the mitigation needed under policy because the 5-year gap versus the benchmark also exceeds the applicable threshold. Only Clark Kellogg, who joined in 2024 and falls within the 24-month new-director exemption, is supported. All other nominees receive an AGAINST vote.
Say on Pay
✓ FORCEO
Craig W. Kliethermes
Total Comp
$7,691,732
Prior Support
96%%
The CEO's total compensation of approximately $7.7 million is within a reasonable range for a CEO at a specialty insurance company with a $5.2 billion market cap, and the prior Say on Pay vote received 96% support, indicating strong shareholder endorsement. The pay structure is heavily performance-based: the MVP Program ties the majority of incentive pay to multi-year economic profit above the cost of capital, with an at-risk bonus bank that can be reduced by future negative results, satisfying the quality-of-incentive test. While RLI's stock has underperformed the S&P 500 (^GSPC — S&P 500) over three years, the pay structure includes meaningful relative performance adjustments tied to peer company book value growth, and the company delivered exceptional operating results in 2025 including a 30th consecutive year of underwriting profit and 23.7% return on equity, supporting a FOR vote on the overall pay program.
Auditor Ratification
✓ FORAuditor
Deloitte & Touche LLP
Tenure
N/A
Audit Fees
$1,305,000
Non-Audit Fees
$0
Deloitte charged RLI only for core audit services totaling $1,305,000 in 2025, with zero non-audit fees, so the non-audit fee ratio is 0% — well within the 50% threshold. Auditor tenure is not disclosed in the proxy, so the tenure trigger cannot be applied and a FOR vote stands per policy. Deloitte is a Big 4 firm appropriate for a company of RLI's size.
Overall Assessment
This ballot has three standard proposals: director elections, Say on Pay, and auditor ratification. Nine of the ten director nominees receive AGAINST votes due to significant stock price underperformance versus the S&P 500 (^GSPC — S&P 500) over the past three years; only the newly appointed Clark Kellogg is supported under the new-director exemption. The Say on Pay and auditor ratification proposals both pass policy screens and receive FOR votes.
Compensation Peer Group
1 companies disclosed in 2026 proxy filing