Best’s Special Report: US Property/Casualty Impairments in 2024 Fell Sharply

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)--
One U.S. property/casualty company became impaired in 2024, compared with 13 in the previous year, according to an AM Best report.

The report, titled, “2024 US Property/Casualty Impairments Update,” states that the lone 2024 insurance company impairment was a small automobile physical damage-only carrier geographically concentrated in the Chicago, IL, metropolitan area. It had ceased transacting new or renewal business in 2022; the final policy expired in April 2023. In addition to identifying impairments that occurred in 2024, this Best’s Special Report also includes information on other impairments that occurred from 2000 to 2023.

Other takeaways in this report include:

During the 2000 to 2024 study period, 433 P/C insurers became impaired, consisting of 370 insolvent liquidations and 61 rehabilitations, 45 of which were closed during the period; 16 remain open as of this report. In addition, there were 59 conservatorships, 57 of which led directly to either rehabilitation or liquidation.
From 2000 to 2024, workers’ compensation insurers accounted for 23% of the impairments. Personal lines insurers accounted for 31%, split between private passenger auto (20%) and homeowners (11%). Commercial lines insurers accounted for 22% of impairments, with other liability/commercial multiperil accounting for 14% and commercial auto making up 8%. The remaining 23% was split among specialty lines.
The report identified specific causes for 115 of the impairments. Catastrophe losses were the leading cause of 39 impairments, followed by fraud or alleged fraud, at 25. Other causes of impairments included affiliate problems, issues related to rapid growth and investment losses.

To access a copy of this report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=363112.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.