JERSEY CITY, N.J., July 16, 2015 — Private U.S. property/casualty insurers’ net income after taxes grew to $18.2 billion in first-quarter 2015 from $13.9 billion in first-quarter 2014, with insurers’ overall profitability as measured by their rate of return on average policyholders’ surplus growing to 10.8 percent from 8.4 percent, according to ISO, a Verisk Analytics (Nasdaq:VRSK) business, and the Property Casualty Insurers Association of America (PCI).
Insurers’ combined ratio improved to 95.7 percent in first-quarter 2015 from 97.1 percent in first-quarter 2014. Net written premium growth remained unchanged at 3.7 percent for the first quarters of 2014 and 2015. Net investment income increased to $11.7 billion in the first quarter of 2015 from $11.2 billion a year earlier, and realized capital gains jumped to $4.7 billion from $2.9 billion, resulting in $16.4 billion in net investment gains for first-quarter 2015.
“Property/casualty insurers had a strong first quarter, underscoring strong capital levels, competitive markets, underwriting disciplines, and business competencies,” said Robert Gordon, PCI’s senior vice president for policy development and research. “These results, partially attributable to mild catastrophic losses, have insurers well positioned to continue to provide the necessary financial security for their policyholders as we move farther into yet another uncertain hurricane season.”
“The industry needs to focus on underwriting, as investment gains may be unpredictable and investment yields will likely remain suppressed for a while,” said Beth Fitzgerald, president of ISO Insurance Programs and Analytic Services. “It’s those insurers that stay current on emerging issues and make use of predictive analytics that will be the best prepared to weather potential storms that the markets, social or technological developments, or nature might send their way.”
To view the full report from ISO and PCI, click here.
Since 1971, ISO has been a leading source of information about property/casualty insurance risk. For a broad spectrum of commercial and personal lines of insurance, ISO provides statistical, actuarial, underwriting, and claims information and analytics; compliance and fraud identification tools; policy language; information about specific locations; and technical services. ISO serves insurers, reinsurers, agents and brokers, insurance regulators, risk managers, and other participants in the property/casualty insurance marketplace. ISO is a Verisk Analytics (Nasdaq:VRSK) business. For more information, visit www.verisk.com/iso and www.verisk.com.
PCI is composed of nearly 1,000 member companies, representing the broadest cross section of insurers of any national trade association. PCI members write more than $183 billion in annual premium, 35 percent of the nation’s property casualty insurance. Member companies write 42 percent of the U.S. automobile insurance market, 27 percent of the homeowners market, 32 percent of the commercial property and liability market and 34 percent of the private workers compensation market. For more information, visit www.pciaa.net.
Giuseppe Barone for ISO
Jeffrey Brewer for PCI
Loretta Worters for I.I.I.