S&P International: Private Strains Lead Progress; Underwriting Tendencies Combined Throughout Segments
U.S. property and casualty insurers wrote greater than $1.05 trillion in direct premiums in 2024, surpassing the trillion-dollar mark for the primary time in trade historical past, based on S&P International Market Intelligence’s evaluation of statutory filings. The 8.0% year-over-year enhance was pushed primarily by robust positive aspects in private strains, particularly non-public auto and householders’ insurance coverage.
Private Strains Propel Historic Premium Progress
Private strains premiums totaled $534.92 billion, up from $477.04 billion in 2023. Non-public passenger auto posted the biggest enhance amongst all strains, rising 12.6% to $358.77 billion. Householders insurance coverage premiums climbed 11.1% to $169.55 billion, whereas farmowners protection contributed $6.60 billion.
Industrial strains additionally posted premium progress, although at a extra reasonable tempo. Whole industrial direct premiums written reached $502.35 billion, a 4.0% enhance from the prior 12 months. Key segments included legal responsibility ($162.70 billion), industrial property ($103.97 billion), industrial auto ($70.94 billion), and employees’ compensation ($55.42 billion). Staff’ compensation was the one main line to contract, with premiums falling 5.3% 12 months over 12 months.
A notable change in 2024 was the introduction of pet insurance coverage as a stand-alone reporting line. Beforehand categorized beneath inland marine, the shift displays each elevated quantity and rising curiosity within the product from carriers and distributors.
Underwriting Margins Rebound in Private Strains
The trade’s total underwriting efficiency improved in 2024, supported by a notable restoration in private strains. The combination direct incurred loss ratio fell to 61.9%, down from 65.4% in 2023. Private strains noticed a 9.3-point enchancment, ending the 12 months at a loss ratio of 64.6%.
Non-public auto, which had been beneath profitability strain in recent times, reported a direct incurred loss ratio of 66.1%, down from 75.4% the 12 months earlier than. Householders improved to 61.5%, from 70.6% in 2023.
Against this, industrial strains posted a better loss ratio of 58.8%, up 1.9 factors from the prior 12 months. Essentially the most vital deterioration occurred within the “different legal responsibility” phase, which incorporates normal legal responsibility, extra and umbrella, cyber, and errors and omissions. That line posted a loss ratio of 70.8%, up from 63.0% in 2023.
Staff’ compensation additionally noticed a modest enhance in its loss ratio, rising to 46.8% from 45.0%. Industrial auto loss expertise was combined: total, the phase improved to a 72.9% loss ratio, however the legal responsibility portion worsened barely to 77.4%, whereas bodily injury outcomes improved by 7.4 factors to 57.8%.
Strategic Outlook for Brokers and Carriers
The record-setting premium quantity displays the mixed affect of sustained charge exercise, inflation-driven publicity progress, and elevated demand for protection throughout each private and industrial strains. For carriers, the restoration in private auto and householders profitability provides some reduction following a number of troublesome underwriting years, although frequency and severity tendencies stay key variables.
In industrial strains, alternatives stay in transportation, property, and choose legal responsibility niches, however deteriorating loss tendencies in sure sectors could immediate underwriting recalibration. The emergence of pet insurance coverage as a separate reporting line underscores evolving shopper demand and opens the door for specialization and product growth by companies, MGAs, and carriers alike.
S&P International’s full dataset gives detailed roll-ups of each reported line of enterprise, together with templates to research multi-year market share tendencies throughout the trade.