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Personal lines drive US insurers’ earnings recovery

The US property and casualty industry made a net underwriting gain of $US9.3 billion ($13.9 billion) in the March quarter, rebounding from a year-earlier loss of $US8.5 billion ($12.7 billion), according to AM Best.

The ratings agency says a turnaround in personal lines was primarily responsible for the improvement and “industry results were aided by a decline in severe convective storms”.

AM Best’s assessment is based on data from US insurers that account for 98% of total net premium written and 97% of policyholder surplus.

Direct written premium in the quarter rose to $US245.1 billion ($367.6 billion) from $US221.7 billion ($332.5 billion).

The industry’s combined operating ratio improved to 94.2% from 102.5%.

AM Best estimates catastrophe losses accounted for 5.1 points on the three-month combined operating ratio, down from an estimated 7.6 points in the previous corresponding period, which was affected by record convective storm losses. 

Net catastrophe losses dropped to $US10.8 billion ($16.2 billion) from $US14.6 billion ($21.9 billion).