The general insurance sector is "buoyant", according to a new report by the CBI and PricewaterhouseCoopers (PWC).
The latest quarterly Financial Services Survey, conducted in February and March 2004, found that growth in general insurance business volumes was stronger than in any other sector of the financial services industry.
It said that every general insurer surveyed reported a rise in business volumes over the past quarter.
As a result, the level of general insurance business rose to its highest point since June 2002.
PWC partner and UK insurance leader Clare Thompson said the sector was showing "very substantial optimism". She said: "It's all looking very rosy." she said.
Thompson said evidence that the value of claims wascontinuing to go down after a relatively benign UK winter was helping to boost the optimism of general insurers.
But she said the "biggest surprise" in the sector was an increase in employment for the first time in more than a year.
However, Thompson said this might reflect the trend by general insurers to employ staff offshore rather than in the UK.
Unlike insurers, the confidence of brokers continues to deteriorate, according to the report.
Thompson said increasing concerns over FSA regulation was the key factor driving confidence down.
The survey found that while brokers' business volumes have stabilised, profitability in the broking sector continues to fall.
