Insurers' Income and Surplus Rise Through Nine-Months 2005 Despite Record Catastrophe Losses
as posted at www.insurancebroadcasting.com
JERSEY CITY, N.J., Dec. 27 — The U.S. property/casualty insurance industry’s net income after taxes rose 4.4 percent, or $1.2 billion, to $28.8 billion in nine-months 2005 from $27.6 billion in nine-months 2004. Reflecting the industry’s income, its consolidated surplus, or statutory net worth, increased 5.2 percent, or $20.4 billion, to $414.3 billion at September 30 from $393.8 billion at year-end 2004, according to ISO and the Property Casualty Insurers Association of America (PCI).
The industry’s net income and surplus increased despite record catastrophe losses. Including losses from Hurricanes Dennis, Katrina, Ophelia and Rita, direct insured property losses due to catastrophes through nine-months 2005 totaled $47.6 billion — nearly double the $27 billion in direct insured property losses due to catastrophes through nine-months 2004, according to ISO’s Property Claim Services (PCS) unit. Adjusting for losses covered by residual market mechanisms and foreign reinsurers, ISO estimates that private insurers’ net catastrophe losses through nine-months 2005 totaled $27 billion to $32 billion — up from $15.8 billion through nine-months 2004.
Reflecting sharply higher net catastrophe losses, the industry suffered a $2.8 billion net loss on underwriting through nine-months 2005 — a $6.1 billion adverse swing from the $3.2 billion net gain on underwriting through nine-months 2004.
The figures are consolidated estimates for all private property/casualty insurers based on reports accounting for about 96 percent of all business written by private U.S. property/casualty insurers.
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