The U.S. property/casualty (P/C) industry saw its net underwriting income fall in first-quarter 2021 by 53% as compared with the same prior-year period, according to preliminary financial results. This financial review is detailed in a new Best’s Special Report, “First Look: Three-Month 2021 Property/Casualty Financial Results,” and the data is derived from companies’ three-month 2021 interim statutory statements that were received as of June 1, representing an estimated 99% of the total P/C industry’s net premiums written.
According to the report, the combined ratio for the P/C industry deteriorated to 96.4 from 95.0 in the first quarter of 2020. Catastrophe losses accounted for an estimated 6.9 points on the three-month 2021 combined ratio, up from an estimated 3.3 points in first-quarter 2020. Despite 2.3% growth in net earned premiums in the quarter, increases in incurred losses, loss adjustment expenses (LAE) and underwriting expenses, as well as a sharp 72% rise in policyholder dividends, drove the underwriting income decline.
With net investment declining slightly, the drop in underwriting income drove a 12.9% reduction in pre-tax operating income. As tax expenses were down 18.4% and realized capital gains were up $4.1 billion, industry net income increased by 11.4% from the same prior-year period to $20.2 billion.
To access the full copy of this special report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=309265 .