Hartford, Conn. — The financial condition of the property/casualty industry is strong, according to new research by Conning Research and Consulting, which also finds the industry should be able to withstand the current price deterioration affecting insurers.
"The outlook for the next three years—through 2010—is generally soft for the property/casualty industry as a whole. We project continued deterioration in underwriting margins and implied return on equity," says Clint Harris, analyst at Conning. "However, the largest year-over-year increase in combined ratio is in 2008, and while this reflects a return to normal catastrophe losses, much of this deterioration is self-inflicted, as premium prices and premium rate adequacy continue to fall."
The Conning Research study, "Property-Casualty Forecast & Analysis," identifies the key drivers of the industry and forecasts industry growth and performance for 2007 to 2010.
"Looking beyond this year, our forecast contains a somewhat more optimistic view of 2009 and 2010 because we anticipate a modest rebound in the economy and also a moderating competitive environment," says Stephan Christiansen, director of research at Conning. "We project a return to net premium rate increases beginning in some lines as early as 2009. In fact, we already are beginning to observe some insurers taking corrective actions in their markets because of poor results."
Source: PR Newswire
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