The property/casualty insurance industry turned a corner and will show a profitable year for 2010, but underwriting discipline will be more important than ever in 2011, said chief executive officers (CEOs) participating in the View from the Inside Looking Out, a panel discussion at the 15th annual Property/Casualty Joint Industry Forum, held in New York.
CEO panelists agreed that while the P/C industry is still recovering from the effects of the economic downturn, there are some positive signs for premium growth going into 2011. Some items that helped put the P/C Industry in the black for 2010 but can’t be counted on in 2011 were the release of prior year reserves that were not required for losses, increased investment returns and relatively mild CAT (catastrophe) losses.
The survey showed that 94% of executives in the property/casualty industry expect an improvement in profitability in 2011. Other results concerning predictions about inflation, interest rates, investment results, loss ratios, tort lawsuits, the effects of the financial services reform and the new Federal Insurance Office were reported by ProgramBusiness.com. Read more
“2010 was an acceptable year, a good year,” said Liam McGee, chairman, president & CEO, The Hartford Financial Services Group, Inc, but cautioned, “You can’t avoid the fact that in those good numbers you’ve got a release of prior year reserves and returns that are not the kind you want over trend. This year is one where underwriting discipline and managing costs are going to be more important than ever because we can’t allow the results of 2010 to delude us into thinking they are better than the true underlying numbers suggest,” McGee added.
Kristian P. Moor, president & CEO Chartis Inc, noted that there are a number of positives in 2010’s results that the industry will not be able to carry through into 2011. “Investment portfolios won’t perform the same, accident year results are much worse than calendar year results and the return on equity for the industry is pretty poor. These are all things people need to pay attention to as we go into 2011,” he said.
The Property/Casualty Insurance Joint Industry Forum was created to provide leaders from the widest spectrum of the industry with an opportunity to meet with each other in discussion of topics of general interest. Participants included nearly 250 representatives from property and casualty insurance and reinsurance companies and organizations. Of these, roughly 40 percent responded to the survey.
Source: Insurance Information Institute - News Release: January 13, 2011 For entire News Release Read More.