By: Jeff Reich, Founder/President of Florida Surety Bonds
AM Best recently reported that in 2024 and 2025, property and casualty companies have seen historic financial success. According to data from the National Association of Insurance Commissioners, P&C insurers generated record-shattering underwriting profits – surpassing 68 billion – alongside massive investment income as premiums outpaced payouts and expenses. These improved results came after the industry suffered $51 billion in underwriting losses from 2021 through 2023. Both commercial lines and personal lines returned to profitability. Even private passenger auto insurance showed an underwriting profit after showing heavy losses in previous years.
What does this mean for you? Well, commercial property insurance rates are dropping fast this year so it might be a good idea to ask your insurance agent if they’re able to get a more competitive quote on property insurance to be sure you are taking advantage of that. Workers Comp rates have also been declining year after year. As the industry returns to profitability, the P&C marketplace should stabilize.
It is also good to see the profits to build up the loss reserves of the industry as a whole, so there is more capacity to withstand shocking losses like hurricanes and wildfires. If the insurance industry continues to lose money year after year, not only are the cash reserves depleted from paying losses, but the industry also has trouble attracting new investment capital that is looking for a profitable place to invest.
Hopefully, a profitable insurance industry will result in more stability in the marketplace making it easier for businesses to thrive.