OLDWICK, N.J.--(BUSINESS WIRE)--In this A.M.BestTV episode, A.M. Best Senior Managing Director and Chief Rating Officer Stefan Holzberger reviews highlights from A.M. Best's annual Review/Preview report for the U.S. property/casualty (P/C) insurance industry, including how automobile, homeowners and commercial writers are responding to a challenging underwriting environment and an abundance of capital. Click on http://www.ambest.com/v.asp?v=pc117 to view the entire program.
Two of the three segments within the U.S. P/C industry have a negative outlook, with the exception being personal lines. Holzberger addressed how A.M. Best views the personal lines sector in light of the deteriorating automobile market.
“The main rationale for maintaining a stable outlook for the personal lines companies is the very strong level of risk-adjusted capitalization that A.M. Best believes is more than sufficient to absorb some level of volatile results in terms of personal automobile,” said Holzberger. “Speaking specifically to personal automobile, A.M. Best believes that the trend of negative performance is likely to reverse itself this year. This belief is based on the market having generated reasonably sizable rate increases, gas prices moving back up and improving economic conditions.”
Holzberger also spotlighted the challenges that stand in the way of the P/C sector to either repeat or improve upon its underwriting performance in 2017.
“There is a significant amount of excess capital in the market today across all three segments—personal lines, commercial lines and reinsurance. That is a real benefit from a credit standpoint for policyholder security, but it is driving intense competition. In this market with limited room for growth and limited opportunities to put that capital to work, rates, and essentially, profitability, are being driven down.”
To see Holzberger discuss the life/annuity industry visit http://www.ambest.com/v.asp?v=lifeannuity117.
Recent episodes of A.M.BestTV include:
- Repeal of Affordable Care Act Could Trigger Range of Impacts: A.M. Best Senior Director Sally Rosen and Senior Financial Analyst Wayne Kaminski examine provisions of the Patient Protection and Affordable Care Act that might be subject to repeal and how their removal could affect U.S. health insurers: http://www.ambest.com/v.asp?v=aca117.
- Heads of Industry Associations Set 2017 Washington Agenda: Taxes, Flood, Drones: A panel of industry association leaders from the property/casualty, reinsurance and mutual insurance sectors believe fundamental changes in taxation and the federal flood program could benefit insurers: http://www.ambest.com/v.asp?v=pcjf3117.
- Heads of U.S. Industry Associations Face Off on Covered Agreement Deal: A panel of industry associations leaders discuss an announced covered agreement that would allow U.S. companies to operate in European markets, and say that questions remain over equivalence and whether the deal comports with U.S. regulatory systems: http://www.ambest.com/v.asp?v=pcjf2117.
- Commercial Automobile Insurance Sector Still Hindering Overall U.S. Property/Casualty Profitability: A.M. Best Senior Industry Analyst, Industry Research & Analytics David Blades examines why premium increases in the commercial automobile segment are not enough to offset the negative effects from underwriting losses: http://www.ambest.com/v.asp?v=commercialauto117.
.A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View A.M.BestTV episodes at http://www.ambest.tv.
A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2017 by A.M. Best Company, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.