Insurance companies' earnings diminished in first half of 2011
In the first six months of 2011, homeowners insurance companies' net income levels dropped, falling from nearly $17 billion in the first half of 2010 to $4.8 billion this year, a new report from the Property Casualty Insurers Association of America indicates.
Major factors in the decline of income and overall rate of return were net underwriting losses, which grew to $24.1 billion in the first half of 2011 from $5.1 billion during the same period last year, the report states.
While underwriting losses were significant, net investment gains, which jumped to $28.4 billion in the first half of 2011 from $26 billion during the same six month period in 2010, helped offset some losses.
"Despite record-setting catastrophe losses from events like the deadly EF 5 tornado that struck Joplin, Missouri, last May, insurers emerged from first-half 2011 financially sound and well able to continue providing essential financial protection to consumers and businesses alike - a quiet but important testament to insurers' enterprise risk management and the effectiveness of state solvency regulation," said David Sampson, PCI's president and CEO.
Sampson went on to say that property insurance companies are "strong, well-capitalized and capable of paying claims."
Related Home Insurance Articles:
- Homes destroyed by Nevada wildfire May 23, 2012
- Researchers hope to better understand tornado damage May 22, 2012
- Total costs from Minneapolis tornado reach $80 million May 21, 2012
- Analysis shows more than $2B of insurance claims from Joplin tornado May 18, 2012
- Recovery continues for Michigan tornado victims May 17, 2012
