Login Register Subscribe
Current Issue


BI’s Article search uses Boolean search capabilities. If you are not familiar with these principles, here are some quick tips.

To search specifically for more than one word, put the search term in quotation marks. For example, “workers compensation”. This will limit your search to that combination of words.

To search for a combination of terms, use quotations and the & symbol. For example, “hurricane” & “loss”.

Property/casualty insurer profit drops 42.2% in first quarter


The private U.S. property/casualty insurance sector’s first-quarter 2017 net income fell 42.2% from the year-ago period to $7.7 billion, according to an analysis released Monday by Verisk Analytics Inc.'s Insurance Services Office unit and the Property Casualty Insurers Association of America.

The industry’s overall profitability as measured by its annualized rate of return on average policyholders' surplus dropped to 4.4% from 7.9% a year earlier.

The industry experienced $7.3 billion in direct catastrophe losses — the highest first-quarter catastrophe losses since the 1994 Northridge earthquake in California, and $2.3 billion above the direct catastrophe losses for first-quarter 2016. 

Insurers’ combined ratio deteriorated to 99.6% for first-quarter 2017 from 97.4% for first-quarter 2016.

There was some good news: Net written premium growth accelerated to 4% for first-quarter 2017 from 3.2% for first-quarter 2016. Net investment gains increased by $1.2 billion to $14.4 billion in first-quarter 2017 from a year ago.

The industry’s surplus reached a new all-time high value of $709 billion as of March 31, increasing $8.1 billion from $700.9 billion as of Dec. 31, 2016.

“Three major wind and thunderstorm events each resulted in more than $1 billion in damages in first-quarter 2017,” Beth Fitzgerald, ISO’s senior vice president for industry engagement, said in a statement. “That’s the first time we’ve seen three events of that magnitude in the first quarter in more than 60 years. Fortunately, insurers are well-capitalized, and short-term volatility in catastrophe losses is not affecting their ability to provide coverage and pay claims.”

While insurers are seeing some acceleration in premiums and investment income, Ms. Fitzgerald said that in order to remain profitable and provide appropriate returns on their capital, they “need to plan for the long term and continue to engage in disciplined underwriting based on robust data and analytics.”