U.S. PROPERTY-CASUALTY INSURERS SEE NET INCOME JUMP 268% IN FIRST NINE MONTHS

U.S. property-casualty insurers reported net income for the first nine months of 2009 jumped 268.2% to $16.2 billion, up from $4.4 billion in the first nine months of 2008, but tumbled 67.3% compared to $49.6 billion earned during the same period in 2007, according to Jersey City, NJ-based ISO and the Property Casualty Insurers Association of America (PCI). Net underwriting losses dropped to $3.2 billion, down from $19.8 billion in 2008, driven by a $26.5 billion drop in claims costs, and the combined ratio improved to 100.7% compared to 105.5% a year ago. Despite the negative 49.6% annualized return rate posted by mortgage and financial guaranty insurers, property-casualty insurers achieved an overall annualized return rate of 4.5%, up from a 1.2% annualized return rate a year ago, but almost half the average annualized return rate of 8.9% achieved during the past 24 years. Commenting on the industry’s performance, PCI President and CEO David Sampson said, “Property-casualty insurance failures remain extremely rare events, but, year-to-date through December 19, regulators had seized 140 banks. Insurers’ superior performance reflects the strength of their balance sheets. Combining insurers’ $490.8 billion in policyholders’ surplus at September 30, 2009, with their $552.4 billion in loss and loss adjustment expense reserves and their $204.7 billion in unearned premium reserves, insurers had more than $1.2 trillion in funds available to fulfill their promises to consumers.”