American Property Casualty Insurance Association Publishes Analysis of Financial Operating Results and Trends Impacting 2021

WASHINGTON, May 12 (TNSRes) -- The American Property Casualty Insurance Association issued the following news release on May 11, 2021:

The American Property Casualty Insurance Association (APCIA) is releasing today a new detailed analysis of the Property Casualty insurance industry's financial operating results and trends impacting 2021.

"Insurers' net income and net written premium growth declined in 2020 as the industry was hit by the COVID-19 pandemic and severe natural catastrophe losses," said Robert Gordon, senior vice president, policy, research & international for APCIA. "Investment yields fell to the lowest level since at least 1960. Insurers eked out a $5.1 billion underwriting gain on more than $650 billion of NWP after reserve releases, although that gain may not reflect significant potential long-tail losses from COVID-19."

APCIA's report explores underwriting gains and losses, examining how the personal auto combined ratio dropped due to a temporary reduction in miles driven. While personal auto writers provided various forms of rebate and significant rate reduction, severity of claims continued to climb significantly, and miles driven has been rapidly increasing in 2021.

The report also analyzes the economic impact of COVID-19 on the insurance industry and other commercial sectors. "The pandemic has caused tens of billions of dollars in insured losses in the United States and tens of trillions of dollars in long-term economic losses worldwide," said Gordon.

Aside from COVID-19 losses, 2020 went on record as an unusually costly year for U.S. property catastrophe claims. Those losses were particularly due to hurricanes, wildfires, civil unrest, and floods. In 2021, insurers will continue to face the threat of wildfires, an above-average hurricane season and other weather events, APCIA concludes.