US motor insurance net losses to grow in 2017: Report
Private auto net incurred losses will increase by nearly 7 percent in 2017 to a new record of approximately $154 billion, reflecting elevated volume and costs of claims, according to the third annual US Property & Casualty Insurance Market Report by S&P Global Market Intelligence.
Auto losses soared by 13 percent in 2016 due to unfavourable claims experience for the underwriters, leading carriers to broadly pursue rate increases. Those rate increases are expected to lead to higher premiums for consumers in the near term, but will also lead to gradual improvement in the profitability of the business.
"Though underwriting results in many business lines will deteriorate in 2017, we expect the P&C industry to produce only a modest underwriting loss for the year," said Tim Zawacki, senior insurance research analyst, S&P Global Market Intelligence. "Needed rate increases for the personal and commercial auto businesses will begin to positively impact industry results in 2017. We expect additional improvement in those lines to take place over the next several years."
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