P/C Insurers Achieve Record $9.3B Underwriting Gain in Q1 2024

The U.S. property/casualty (P/C) insurance industry recorded a significant underwriting gain of $9.3 billion in the first quarter of 2024. This represents a major turnaround from the $8.5 billion loss experienced in the same period last year, according to a recent AM Best report.

Why This Matters. This notable recovery highlights the resilience and adaptability of the P/C insurance sector, despite challenges posed by increasing claims severity and natural disasters. It also underscores the critical role of effective underwriting and risk management practices in maintaining industry stability.

Key Insights

• Net Premiums Written: The industry's net premiums written reached $222.9 billion in Q1 2024, marking a 7.4% increase over Q1 2023.

• Combined Ratio Improvement: The combined ratio improved to 94.2, driven by an 8.2-point reduction in the loss and loss adjustment expense ratio.

• Catastrophe Losses: Catastrophe losses amounted to $10.9 billion, down from $14.6 billion in Q1 2023.

• Investment Income: A 33.3% increase in net investment income contributed significantly to the industry's pre-tax operating income, which surged to $30.0 billion from $6.9 billion in Q1 2023.

Data and Analysis

• Underwriting Gain: $9.3 billion in Q1 2024 vs. $8.5 billion loss in Q1 2023.

• Net Income: $39.9 billion in Q1 2024, up from $7.9 billion in Q1 2023.

• Catastrophe Losses: $10.9 billion in Q1 2024, contributing 5.1 points to the loss and combined ratios.

Source: AM Best