P/C Insurance Industry’s Net Income Drops 42.2% in Q1 2017
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The private U.S. property/casualty insurance industry saw its net income after taxes drop to $7.7 billion in first-quarter 2017 from $13.4 billion in first-quarter 2016-a 42.2 percent decline-and its overall profitability as measured by its annualized rate of return on average policyholders’ surplus fall to 4.4 percent from 7.9 percent, according to ISO, a Verisk Analytics business, and the Property Casualty Insurers Association of America (PCI).
The industry experienced $7.3 billion in direct catastrophe losses-the highest first-quarter catastrophe losses since the 1994 Northridge earthquake and $2.3 billion above the direct catastrophe losses for first-quarter 2016. Insurers’ combined ratio deteriorated to 99.6 percent for first-quarter 2017 from 97.4 percent for first-quarter 2016.
According to Beth Fitzgerald, senior vice president, Industry Engagement for ISO, there were three major wind and thunderstorm events that totaled more than $1 billion in damages during the first quarter of 2017.
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