The nation's property and casualty insurers reported profits of $41.3 billion last year, a 28% increase from the year before, Weiss Ratings Inc. in Jupiter, Fla., said on Monday.
Contributing to the industry's performance, underwriting profits set a record, surging to $6.4 billion, compared to a $2.9 billion loss the previous year. The underwriting gain was primarily due to an increase in earned premiums, which jumped from $387.7 billion in 2003 to $414.3 billion.
Improved underwriting was also responsible for a $51.5 billion, or 11.6%, increase in capital and surplus, the ratings company said.
As a result of improved underwriting, the industry's loss ratio - the percentage of losses paid out compared to earned premium collected - declined further. The overall loss ratio, which excludes loss adjustment or underwriting expenses, fell to 59.8% last year, from 61.7% the year before.
The lines of business posting the highest loss ratios last year were product liability and health at 79.9 points and 69.2 points, respectively. Product liability's ratio was up 5.76 points from the year earlier, but the health ratio fell 3.2 points.
