Profits for P&C insurers grow in H1 2015


US property/casualty (P&C) insurers' profitability has experienced a healthy growth in the first half of this year. 
This is according to ISO, a Verisk Analytics business, and the Property Casualty Insurers Association of America (PCI). New data shows the net income after taxes of P&C insurers grew to $31 billion in the first half of 2015 compared with $26 billion in the first half of 2014.
Insurers' overall profitability, measured by their rate of return on average policyholders' surplus, also grew to 9.2 percent from 7.8 percent, according to the research. 
Combined ratio for P&C insurers improved to 97.6 percent in first half of the year, compared with  98.9 percent in the first half of 2014. Net written premium growth remained unchanged at 4.1 percent for the first halves of 2014 and 2015.
Net investment income increased to $23.4 billion in the first half of 2015 from $23 billion a year earlier, and realised capital gains increased to $8.2 billion from $7.2 billion, resulting in $31.6 billion in net investment gains for first-half 2015.
"While Old Man Winter did his best to disrupt things in the Northeast, during the first half of 2015 insurers overall incurred lower domestic catastrophe losses than they did during the first half of last year due to a relatively quiet tornado season and the slow start to hurricane season," said Robert Gordon, PCI's senior vice president for policy development and research. 
"Insurers' combined ratio and rate of return all improved in the first half of 2015, while premium growth and investment income remained relatively stable."
Beth Fitzgerald, president of ISO Solutions, added: It's important to note that US catastrophe losses during the first half of 2015 were only slightly lower than the ten-year average. 
"As the devastation caused by meteorological conditions associated with Hurricane Joaquin highlights, it's crucial for insurers to remain disciplined in their underwriting and look at analytics to be ready not only for weather disasters but also for other major challenges the future may hold."


ISO Solutions, Property Casualty Insurers Association of America, Robert Gordon, Beth FItzgerald, North America

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