Top 25 Carriers’ Q3 Premiums Rise Nearly 11.5% in 2010 Versus Q3 2009

Alexander Hamilton once said, “I never expect to see a perfect work from an imperfect man.” Despite an imperfect marketplace, the Top 25 property/casualty companies continued to improve. Their continued improvement is evident based on the dollar amount of direct premium written growth from 2009 to 2010.

For the nine months ending Sept. 30, 2010, companies comprising the Top 25 writers of P/C insurance in terms of premium growth applied their experience and, despite a difficult marketplace, improved their direct premium written by nearly 11.5 percent over the nine months ending Sept. 30, 2009. This represents an increase of approximately $7.75 billion in premium, showing measurable achievement by these companies.

As with past reporting periods, the more than 2,000 insurers that comprise the remainder of the industry did not fare as well. In fact, their third quarter to third quarter direct premium written declined more than 2.2 percent, or nearly $6.51 billion. In total, direct premium written for the industry was up more than $1.24 billion.

In an impressive display of growth, financial stability and the application of experience for progress, the Top 25 carriers wrote over 20 percent of the P/C insurance industry’s direct premium written. Although the pricing cycle in the P/C insurance marketplace continues to be characterized as soft, the aggressive growth exhibited by the Top 25 leads one to believe that the softest part of the cycle is behind us. It seems unlikely that the world-class companies comprising the Top 25 would need to be particularly competitive on price to be able to grow.

If this is correct, the pricing cycle may soon reach its bottom. Firmer prices should assist all participants in the P/C insurance industry report period-to-period premium growth. However, until a hard market is the reality, I expect the Top 25 to lead the industry in premium growth on both percentage and actual dollar bases.

Topics Trends Carriers Pricing Trends Market Property Casualty