A.M. Best: P&C Posts Second Loss in 2017
According to A.M. Best, the U.S. property and casualty (P&C) industry will post its second consecutive underwriting loss in 2017, mainly due to catastrophe losses. The industry’s 2017 combined ratio is expected to deteriorate to 105.1 percent in 2017 from 100.9 percent in 2016, A.M. Best reports.
Extensive insured losses in the third and fourth quarters can be attributed to hurricanes and wildfires. A.M. Best indicates that competitive pricing conditions were entrenched in most commercial lines, but by the end of the year, there was widespread recognition of the need for price increases in key P&C lines. Meanwhile, the personal lines segment was impacted by the catastrophe losses as well as higher losses for auto liability and rising costs for vehicle repairs that negatively affected physical damage losses.
A.M. Best maintains a stable outlook on the U.S. personal lines segment for 2018 and revised its market outlook on the commercial lines segment to stable. Meanwhile, according to a recent Standard & Poor’s (S&P) report, the U.S. property and casualty industry made it through the 2017 record catastrophe losses relatively unscathed, but 2018 could bring the inflection point for pricing levels.