P&C earnings up 30 percent

Property and casualty (P&C) operating earnings increased by 30 percent in 2013 and the group’s overall combined ratio saw a 5.2 point improvement to 93.3, according to Fitch Ratings.

In the company’s latest analysis, which looked at 48 publicly traded companies from various industry subsectors, only seven of the companies recorded lower year-over-year operating return on equity in 2013, while only four reached a combined ratio above 100.

The increase is being attributed to improved underwriting results and a lack of natural catastrophes.

However, Fitch says that 2013 could represent a peak year for results for the next few years.

“Pricing gains have slowed in primary lines and property reinsurance rates declined at the January 1 renewal. An anticipated return to normalized catastrophe activity and diminished reserve releases suggests that 2014 underwriting margins will more likely decline. Profitability will be further pressured by lower reinvestment rates of insurers' maturing fixed-income investments,” said Fitch.