The US property/casualty industry more than doubled its net income for the first quarter of 2004, said the Property Casualty Insurers Association of America (PCI).
It said net income increased from $6.53bn in the first quarter of 2003, to $13.31bn for the first quarter of 2004.
But the PCI said signs of renewed competition suggested that insurers earnings are approaching a cyclical peak.
Growth in net written premiums slowed to 4.5%, reaching $105.98bn for the first quarter. This compares with a 12.7% increase reported for the same period in 2003, said PCI.
PCI said the industry posted a 93.3% combined ratio for the first quarter, a slight improvement on the 99.6% recorded for the comparable period in the previous year.
Roger Kenney, PCI assistant vice president for research, said second-quarter underwriting results could be even better than those of the first quarter.
But he warned that no one was sure how long property casualty underwriting would remain profitable.
“With forecasters predicting an unusually severe hurricane season this year and some industry observers believing that insurers' loss and loss-adjustment expense reserves for asbestos and other claims are deficient,” Kenney said.
“There's a real possibility that loss and loss-adjustment expenses could increase substantially at the same time that competition in insurance markets intensifies, putting pressure on underwriting profitability.”
The PCI data is based on information from 96% of all business written by private US property/casualty insurers.
