Policyholder surplus for the property and casualty industry reached yet another record level at the end of H1 2014, hitting $683.1 billion, according to a webinar from A.M. Best.
Jennifer Marshall, assistant vice president in the property casualty ratings department at A.M. Best, commented: “That's about a $20 billion increase from where it was at year-end 2013, about a 3 percent growth.”
“This is in line with what has been the average growth rate over the last 10 years of about 6.5 percent per year, although with some variation depending on market conditions, both the insurance market and the investment markets.”
The industry has reached a new level of surplus in every year since it fell slightly in 2008, according to A.M Best.
Its projection for the full year this year is that same $683 billion, but the projection does not include realised and unrealised capital gains.
Underwriting income has declined substantially, to just over $500 million from $5.5 billion in H1 2013. Net investment income has also declined by $1 billion, according to the ratings agency.
Marshall continued: “Other income, which typically is comprised of things like adjustments due to changes in accounting methodologies or changes in non?admitted assets, actually improved by about $2 billion over the course of the last year. But pre?tax operating income still declined to $24.5 billion dollars.”
