U.S. property/casualty insurers' net income after taxes in the third quarter of 2013 rose 74.5% over the third quarter of 2012 to $18.5 billion, according to an analysis released Thursday by Jersey City, N.J.-based Verisk Analytics Inc.'s Insurance Services Office Inc. unit and the Chicago-based Property Casualty Insurers Association of America.
Net written premiums for the quarter rose 3.8% from the prior-year period to $126.2 billion.
The industry's combined ratio improved to 91.8% during the third quarter of 2013 from 98.5% in the third quarter of 2012, the lowest level since the 90.6% for the third quarter of 2006 and 13.9 percentage points below the 105.7% average for the third quarter based on quarterly records extending back to 1986.
For the industry overall, net gains on underwriting grew to $8.2 billion in this year's third quarter from $200 million in the third quarter of 2012. Investment income slipped 2.9% from the year-ago period to $11.1 billion.
“In third quarter 2013, the industry achieved its 14th successive quarter of growth in written premiums following 12 quarters of declines, and earned premiums have now risen for 13 successive quarters,” said Robert Gordon, PCI's senior vice president for policy development and research, in a statement. “The growth in earned premiums and the drop in loss and loss adjustment expenses were the biggest contributors to improvement in insurers' overall results in third quarter 2013.”
The insurers' net income after taxes during the first nine months of 2013 rose 54.7% from the prior-year period to $43 billion.
Net written premiums for the first nine months of 2013 rose 4.2% over the year-ago period to $363.4 billion. Nine-month investment income fell 2.9% to $34.3 billion.
The group's combined ratio improved to 95.8% for the for the first nine months of 2013 from 100.7% in the year-ago period.
“Growth in overall net written premiums held fairly steady, accelerating only slightly to 4.2% in nine months 2013 from 4.1% in nine months 2012,” said Michael R. Murray, ISO's assistant vice president for financial analysis, in the statement. “But written premiums through nine months haven't grown this rapidly since 2006, when they rose 5.1% compared with their level a year earlier.”