Catastrophes Took Big Bite Out of Insurers’ 2011 Profits
U.S. property and casualty insurance providers made a combined $8 billion in profits during the first nine months of 2011, a 70 percent dip from the $27.1 billion in net, after-tax income brought in during the same period last year, with industry experts blaming the decline largely on underwriting losses caused by natural disasters.
Net losses on underwriting climbed to $34.9 billion over the nine-month period, eclipsing the $6.3 billion for the first three-quarters of 2010, according to a report by ISO and the Property Casualty Insurers Association of America (PCI).
Analysts found that the poor returns are largely the result of a hike in net losses and loss adjustment expenses (LLAE) due to catastrophes, which caused $33.2 billion in LLAE from January through September.
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