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Member, Beacon International Group, Ltd.
NEW YORK--The property/casualty insurance industry could enjoy an underwriting profit for the second year in a row in 2007, according to an average of predictions made by analysts participating in the Insurance Information Institute's annual Groundhog survey.
According to the forecast released Friday, the analysts predict that insurers will have a combined ratio of 96.6% this year, a slight deterioration from last year's estimated 93.2%, but still only the third annual underwriting profit since 1978.
The average forecast calls for an increase in net written premiums of only 1.8% in 2007, only slightly better than half of the 3.3% increase projected for 2006. According to the survey, that rate of increase in premium growth would be the third-slowest rate since 1978, "during the depths of the last soft market."
"Buyers of insurance are, of course, the clear winners when it comes to reaping the benefits of slowing premium growth," noted the survey. "Businesses will see declines of 5% or more in 2007, across their entire insurance program."