Private U.S. property and casualty insurers’ net income after taxes rose to $16.2 billion through nine-months 2009, partially recovering from the 91.2 decline to $4.4 billion through nine-months 2008 from $49.6 billion through nine-months 2007. Insurers’ overall profitability as measured by their annualized rate of return on average policyholders’ surplus (or statutory net worth) increased to 4.5 in the first nine months of 2009, having previously fallen to 1.2 in the first nine months of 2008 from 13.1 in the first nine months of 2007.

Driving the increases in insurers’ net income and rate of return, net losses on underwriting fell by $16.6 billion to $3.2 billion through nine-months in 2009 from $19.8 billion through nine-months 2008, as claim costs (loss and loss adjustment expenses) dropped $26.5 billion, according to risk management solutions provider ISO and the Property Casualty Insurers Association of America (PCI), which issued the financial report.

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