Property-Casualty Industry Loss Reserve Position Improved, But Redundancy is Concentrated in Just Two Areas
June 24, 2019
Commercial auto and other liability lines are the most pressured
HARTFORD, CT, June 24, 2019—Conning’s annual study of the property-casualty industry’s loss reserves find that the overall reserve position appears to be redundant, after again improving in 2018.
“The property-casualty insurance industry’s reserve position improved again slightly in 2018,” said Bill Burns, a Vice President, Insurance Research at Conning. “While the industry continues to carry sufficient reserves, the redundancy is largely in two lines, workers’ compensation and miscellaneous lines. Additionally, these lines contributed almost all of the favorable development experienced by the industry in 2018.”
The Conning study, “2018 Property-Casualty Loss Reserves: What’s Holding Up the Industry?” reviews the property-casualty industry’s loss reserve position at the end of 2018, by line of business and in total. This is the first study in which Conning includes estimates of reserve adequacy levels for small and large insurance companies. Conning also discloses which companies contributed the largest amounts of favorable and adverse development for each line of business.
“The industry experienced favorable loss development of $11.9 billion in 2018, benefiting the loss ratio by two points,” said Steve Webersen, Head of Insurance Research at Conning. “This is the thirteenth consecutive year of favorable development from prior accident years. However, the other liability and commercial auto lines remain significantly deficient, suggesting future adverse development and continued scrutiny for these lines.”
“2018 Property-Casualty Loss Reserves: What’s Holding Up the Industry?” is available for purchase from Conning by calling (888) 707-1177 or by clicking here. For more information on Conning studies, please visit www.conningresearch.com.