A series of massive storms have left a mark in the first-quarter profits of the nation’s property and casualty insurers.
ISO and Property Casualty Insurers Association of America’s reports have stated that the industry experienced $7.3 billion in catastrophic losses in the first three months of 2017 – the highest since California’s 1994 earthquake.
“Three major wind and thunderstorm events reach resulted in more than $1 billion in damages in first-quarter 2017,” Beth Fitzgerald, senior vice president of industry engagement at ISO, said in a Verisk’s report. “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, she went on to say. “They’re also seeing some acceleration in premiums and investment income. However, to remain profitable and provide appropriate returns on their capital, insurers need to plan for the long term and continue to engage in disciplined underwriting based on robust data and analytics.”
Insurers did report some improvement from the previous year as net written premium growth accelerated to 4% in the first-quarter of 2017, compared to 3.2% in the same period in 2016. Net investment gains increased by $1.2 million to $14.4 billion, up from $13.2 billion for the same period last year.
The industry’s surplus reached a new all-time high of $709.0 billion as of March 31, 2017, increasing $8.1 billion from $700.9 billion on the last day of 2016.
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