P&C Underwriting — Losses Dropped in 2023

AM Best issued a report this week on net underwriting for property-casualty insurers in 2023. The loss was a net $21.2 billion. That’s a bit better than the $29.9 billion lost in 2022.

Most of the underwriting losses can be traced to storm losses.

On a positive note, investment income for 2023 was more than double to $90.1 billion. That came from a $51.1 billion change in net realized capital gains at National Indemnity. Other than that, net investment income was more or less unchanged from 2022 to 2024.

AM Best’s report said the combined ratio is a bit better than 2022. The final 2023 combined ratio is 101.6. In 2022 it was 102.4.

One reason for the continued high combined ratio is catastrophe losses. It added up to 8.7 points in 2023. That’s up from 7.3 points in 2022.

Net written premiums rose 10.4% to $837.7 billion. Losses and loss adjustment expenses jumped 10% to $612.5 billion.

Expenses for underwriting increased 6.4% to $208.3 billion.

Overall, AM Best said big losses in personal lines — especially homeowners insurance — are mainly responsible for the less than satisfying underwriting results.

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