U.S. P&C insurers had improved results in 2013

Private U.S. property and casualty insurers’ net income after taxes grew last year to $63.8 billion, from $35.1 billion in 2012, the Insurance Information Institute said Monday.

Insurers’ overall profitability (measured by their rate of return on average policyholders’ surplus) also increased to 10.3% from 6.1%, the highest level since the 12.4% for 2007, according to a joint statement from the institute, the Property and Casualty Insurers Association of America and ISO, a division of Verisk Analytics.

Insurers’ pre-tax operating income rose from $35 billion in 2012 to $64.3 billion in 2013, the groups said.

The combined ratio also improved from 102.9% in 2012 to 96.1% last year.

Net written premiums rose 4.6% in 2013 to $477.7 billion, and net earned premiums grew 4.2% to $467.9 billion. Net investment gains increased last year increased from $54.2 billion in 2012 to $58.8 billion in 2013.

“Insurers are strong, well capitalized, and well prepared to pay future claims,” Robert Gordon, PCI’s senior vice president for policy development and research said in the statement.

“The U.S. marketplace emerged relatively unscathed from the hurricane season last year. But advanced risk models show that losses from catastrophic events will continue to increase, and insurers will need to keep on building their financial resources to protect policyholders and bolster economic resiliency before the next major event like Hurricane Katrina or the September 11 terrorist attack occurs,” he noted.

“Insurers are taking the steps necessary to secure their financial commitments to consumers. We are also working with homeowners, businesses, and federal, state, and local officials to improve disaster readiness and mitigation to minimize future human tragedy and economic losses. Catastrophe planning and preparation continue to be critical watchwords for 2014.”