Premium Growth: Top 25 Premium Gainers in 2008 Versus 2007

By | June 1, 2009

What is the impetus for growth? Why do some insurers emphasize growth and others do not? In his Sept. 25, 1961, address to the United Nations, President John F. Kennedy described conformity as “the enemy of growth.” This implies that those who emphasize growth are not conformists. If this is the situation, it seems reasonable to conclude that those who drive growth are forward thinking and seek to create the future rather than to conform to the status quo.

During calendar year 2008, the Top 25 property and casualty insurance companies wrote an additional $10.3 billion in direct written premium over the 12-month period ending Dec. 31, 2008, versus the period ending Dec. 31, 2007. The total direct written premium for the Top 25 was nearly $92 billion in 2008 versus $81.7 billion in 2007. Despite an economy that has been unkind to many, direct written premium for the Top 25 grew at an annual rate of nearly 13 percent.

More important to insureds, agents and claimants, Demotech’s review of the reported financial position of the Top 25 indicated that each of the Top 25 carriers had the surplus and financial strength to absorb and support their growth and relative premium level. Many of the insurance companies in the Top 25 were ultimately owned by or are part of well-known and highly respected groups. The insurer with the largest dollar volume of growth was National Union Fire Insurance Co. of Pittsburgh, a member of AIG. In calendar year 2008, it experienced dollar volume growth of nearly $900 million.

One carrier that did not make the Top 25 list because it didn’t meet our criteria of having at least $25 million in direct written premium in the prior period is Berkshire Hathaway Assurance Corp. This company had an exceptional 2008, growing from zero dollars in direct premium written in 2007 to $593,629,919 of premium in 2008.

In an industry that scrutinizes the growth rate of premium writings, consumers and agents are well-served by having a core group of insurance companies capable of responding to the changing insurance and coverage needs of individuals as well as corporate consumers.

Top 25 P/C Companies in Premium Growth
Based Upon Dollar Amount of Direct Premium Written (DPW) Growth; Minimum $25 Million DPW at Dec. 31, 2007; Year Ending Dec. 31, 2008 Versus Dec. 31, 2007

Top 2591,988,124,86281,687,490,78610,300,634,07612.61%

DPW $ Change Rank Company Name DPW 12/31/2008 DPW 12/31/2007 DPW $ Change DPW % Change
1 National Union Fire Insurance Co. of Pittsburgh 6,346,614,262 5,450,523,420 896,090,842 16.44%
2 Allstate Fire and Cas Insurance Co. 2,206,970,644 1,586,628,382 620,342,262 39.10%
3 Rural Community Insurance Co. 1,732,142,355 1,120,385,336 611,757,019 54.60%
4 Liberty Mutual Insurance Co. 3,482,787,666 2,879,017,143 603,770,523 20.97%
5 Travelers Home & Marine Insurance Co. 1,306,159,223 764,998,207 541,161,016 70.74%
6 State Farm Mutual Auto Insurance Co. 28,952,521,998 28,434,556,002 517,965,996 1.82%
7 AIU Insurance Co. 2,770,742,249 2,262,929,283 507,812,966 22.44%
8 Ace Property & Casualty Insurance Co. 1,843,536,611 1,339,144,547 504,392,064 37.67%
9 Westport Insurance Corp. 670,017,291 174,511,502 495,505,789 283.94%
10 GEICO Indemnity Co. 3,334,950,300 2,859,043,536 475,906,764 16.65%
11 American Security Insurance Co. 1,755,789,757 1,302,103,585 453,686,172 34.84%
12 Assured Guaranty Corp. 584,542,064 159,202,567 425,339,497 267.17%
13 State Farm Fire and Casualty Co. 15,245,182,506 14,823,888,784 421,293,722 2.84%
14 NAU Country Insurance Co. 1,155,433,871 740,317,165 415,116,706 56.07%
15 Allstate Property & Casualty Insurance Co. 4,838,844,247 4,486,286,874 352,557,373 7.86%
16 Axis Insurance Co. 396,421,371 108,099,410 288,321,961 266.72%
17 Great American Insurance Co. of NY 1,486,923,371 1,201,843,361 285,080,010 23.72%
18 Mid-Century Insurance Co. 2,461,429,014 2,187,199,186 274,229,828 12.54%
19 American Zurich Insurance Co. 966,608,771 699,627,561 266,981,210 38.16%
20 American Agri Business Insurance Co. 638,647,273 377,810,158 260,837,115 69.04%
21 Firemans Fund Insurance Co. 2,556,819,682 2,319,931,267 236,888,415 10.21%
22 GEICO General Insurance Co. 5,035,414,894 4,810,585,920 224,828,974 4.67%
23 American Bankers Insurance Co. of FL 1,422,287,976 1,199,042,963 223,245,013 18.62%
24 Peerless Ind Insurance Co. 297,448,455 95,696,358 201,752,097 210.83%
25 Producers Agriculture Insurance Co. 499,889,011 304,118,269 195,770,742 64.37%

Data Source: The National Association of Insurance Commissioners, Kansas City, Mo., by permission. Information derived from a Highline Data product. The NAIC and Highline Data do not endorse any analysis or conclusion based upon the use of its data.

About Joseph L. Petrelli

Petrelli is the president and co-founder of Demotech, Inc., a Columbus, Ohio-based financial analysis and actuarial services firm. Visit Demotech.com for additional information. More from Joseph L. Petrelli

Was this article valuable?

Here are more articles you may enjoy.

From This Issue

Insurance Journal West June 1, 2009
June 1, 2009
Insurance Journal West Magazine

Program Directory, Vol I.