Ward Group, provider of benchmarking and best practices services to the insurance industry, has announced the 2014 Ward’s 50 top performing property/casualty insurers.
The Ward’s 50 produced a 10.6-percent statutory return on average equity from 2009 to 2013, compared to 6.9 percent for the P&C industry overall. Each Ward's 50 company has passed all safety and consistency screens and achieved superior performance over the five years analyzed. This is the 24th year Ward Group has conducted the analysis.
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The Ward’s 50 life/health group of insurance companies produced a 21.8 percent statutory return on average equity from 2009 to 2013 compared to 8.1 percent for the life/health industry overall.
“Most insurers saw improvements in both financial returns and overall premium levels,” said Jeff Rieder, partner and head of Ward Group. “In clear signs of continued optimism, our research shows considerable investments are being made in technology, product enhancements and identifying ways to deliver a better customer experience. Companies will be challenged to manage the costs of these initiatives, but have strong financial positions to support the investments. Total policyholder surplus continues to grow and overall financial stability for the industry remains very strong. In selecting the Ward’s 50, we identified companies that pass financial stability requirements and measure their ability to grow while maintaining strong capital positions and underwriting results.”
Insurers were evaluated and passed minimum thresholds to be considered for the Ward’s 50 designation, including: surplus and premiums of at least $50 million for each of the five years analyzed; net income in at least four of the last five years for P&C insurers; adjusted net income in at least four of the last five years for life/health insurers; and compound annual growth in premiums between -10 percent and +40 percent.
Performance Measurements
Insurers that pass the safety and consistency tests are then measured and scored on the following:
- Five year average return on average equity
- Five year average return on average assets
- Five year average return on total revenue
- Five year growth in revenue
- Five year improvement in surplus to written premium for P&C insurers
- Five year average combined ratio for P&C insurers
- Five year growth in surplus for life/health insurers
In addition to achieving greater levels of income returns, the Ward’s 50 benchmarks outperformed in other key performance measures. The Ward’s 50 life/health group outpaced the industry for five year policyholder surplus growth, with 42.5 percent compared to 25.3 percent, and net premium income growth of 22.7 percent compared to 16.6 percent.
The Ward’s 50 P&C group compared 7.6 points lower for the five year combined ratio, with 94.7 percent compared to 102.3 percent, and since 2009 increased policyholder surplus by 28.0 percent compared to 20.0 percent for the industry. Net premiums written for the Ward’s 50 P&C group grew 14.4 percent compared to the industry’s 10.8 percent growth.
The Ward’s 50 benchmark continues to achieve lower expense ratios.
“The expense ratio declined slightly in 2013 for the property-casualty benchmark but increased for the life/health benchmark. We still find the Ward’s 50 benchmarks comparing better than the industry average,” Rieder said, adding that in 2013, expenses relative to revenue were 9.2 percent lower for the Ward’s 50 P&C group of companies and 14.0 percent lower for the Ward’s 50 life/health group.
Wards Top 50 P&C Insurers
ACE American Insurance Company
ACUITY
Alaska National Insurance Company
Alleghany Group
Allstate Insurance Company
American Financial Group
AMERISAFE
The Andover Companies
Assurant Group
Auto Club Enterprises Insurance Group
Chubb Group
Cincinnati Insurance Group
Coverys
The Doctors Company
Eastern Alliance Insurance Group
Erie Insurance Group
First Insurance Company of Hawaii, LTD
FM Global
Franklin Mutual Insurance Group
GEICO*
Goodville Mutual Casualty Company
HCC Insurance Holdings Group
Island Insurance Companies
Jewelers Mutual Insurance Company
Lackawanna Casualty Company
Markel Corporation Group
Metropolitan Property and Casualty Insurance Company
MMG Insurance Company
Munich Reinsurance America, Inc
Nodak Mutual Insurance Company
North Star Mutual Insurance Company
Pacific Specialty Insurance Company
Philadelphia Insurance Companies
ProAssurance
Progressive Insurance Group
RLI Insurance Company*
Rural Mutual Insurance Company
SECURA Insurance Companies
Texas Mutual Insurance Company
Travelers Insurance Group
United Educators
USAA Group*
Utica First Insurance Company
Vermont Mutual Insurance Company
W.R. Berkley Corporation
West Bend Mutual
Western Mutual Insurance Group
Western National Insurance Group
Westfield Insurance
Zurich American Insurance Company
* 24-year recipient, 1991-2014.
