I work in the claims department for an auto insurer, so this question will be for auto insurance companies. In the last few years, many of the major players have been taking severe hits to growth and profitability nationally. This has in part been fueled by lack of frequency of accidents which in turn lowered premiums. At the same time, health care costs have been sky-rocketing at a rate unseen before. Currently most companies are in the same boat as 2010 seems to have bucked the trend of the last five years as frequency has risen quite a bit from results I've seen so far. Depending on the data that you look at, frequency was near that of 2002/2003 levels.
I also believe that the industry is cyclical. Some of the best days for me were back in 2003/2004 when while frequency was declining at the time, most of "us" were still feasting off of the frequency of accidents from years past when rates were raised to such high levels and companies had not started to cut back so drastically like they have from 2008 on. Now that it seems like the change has occured, are we heading back to those good times of growth and happiness?
Most people that do not work in the industry are shocked when I tell them that I want accident frequency to grow as this will mean growth of companies and better opportunities for those that work in claims within the industry. Is this what is occuring?
Are the good times just around the corner?
Moderators: Josh, independent guy