{"id":2098,"date":"2025-10-10T13:23:17","date_gmt":"2025-10-10T13:23:17","guid":{"rendered":"http:\/\/egocene.com\/?p=2098"},"modified":"2025-10-13T15:44:22","modified_gmt":"2025-10-13T15:44:22","slug":"despite-headwindsp-c-insurance-industry-maintains-course-in-2025","status":"publish","type":"post","link":"http:\/\/egocene.com\/index.php\/2025\/10\/10\/despite-headwindsp-c-insurance-industry-maintains-course-in-2025\/","title":{"rendered":"Despite Headwinds,P\/C Insurance Industry Maintains Course in 2025"},"content":{"rendered":"<p><strong><em>By William Nibbelin, Senior Research Actuary, Triple-I<\/em><\/strong><\/p>\n<p>The U.S. property\/casualty (P\/C) insurance industry is on track for a second consecutive year of underwriting profitability in 2025, and is projected to grow faster than the broader U.S. economy, according to the latest <em>Insurance Economics and Underwriting Projections: A Forward View<\/em> report from Triple-I and <a href=\"https:\/\/us.milliman.com\/en\">Milliman<\/a>. The report, which is based on data through the first half of 2025, highlights continued progress despite persistent geopolitical and natural catastrophe uncertainties.<\/p>\n<p><strong>Positive Economic Signals and Lingering Concerns<\/strong><\/p>\n<p>The industry\u2019s economic outlook remains cautiously optimistic. According to Michel L\u00e9onard, Ph.D., CBE, chief economist and data scientist at Triple-I, the industry has benefited from stronger-than-expected underlying growth. He also noted that P\/C replacement costs continue to rise more slowly than overall inflation.<\/p>\n<p>However, L\u00e9onard also pointed to factors that make the outlook for 2026 especially important to watch.<\/p>\n<p>\u00a0\u201cOngoing risks, including tariffs, labor market softening and persistent inflation,\u201d could pose challenges, he said. While the impact of tariffs has been less severe than initially anticipated, their long-term effect remains an open question.<\/p>\n<p><strong>Underwriting Performance: A Mixed Bag<\/strong><\/p>\n<p>Overall underwriting profitability for 2025 is expected to be a repeat of 2024, but to a lesser degree. The performance gap between personal lines and commercial lines is narrowing. \u00a0<\/p>\n<p>\u201cFavorable second-quarter results for homeowners helped narrow the anticipated 2025 gap between personal and commercial lines performance created by the Los Angeles fires in the first quarter,\u201d said Patrick Schmid, Ph.D., Triple-I\u2019s chief insurance officer.<\/p>\n<p>Schmid also noted that personal lines premium growth is expected to remain higher than commercial lines by one point in 2025. That difference is projected to disappear by 2027.<\/p>\n<p><strong>Personal Lines<\/strong><\/p>\n<ul>\n<li><strong>Personal Auto<\/strong>: The personal auto sector continues to be a highlight, with its forecast 2025 Net Combined Ratio (NCR) on track for continued profitability. The forecast has also slightly improved from prior estimates.<\/li>\n<li><strong>Homeowners<\/strong>: Despite favorable results in the second quarter, the homeowners\u2019 NCR forecast for 2025 is still expected to be unprofitable for the year.<\/li>\n<\/ul>\n<p><strong>Commercial Lines<\/strong><\/p>\n<ul>\n<li><strong>General Liability<\/strong>: This continues to be a line of concern. According to Jason B. Kurtz, FCAS, MAAA, a principal and consulting actuary at Milliman, \u201cWe see underwriting losses continuing in 2025, with the 2025 net combined ratio for GL forecast at 107.1.\u201d He also said that, while slight improvement is expected in 2026-2027, \u201cwe estimate GL combined ratios to remain above 100.\u201d Kurtz added, \u201cDirect incurred loss ratios through mid-2025 have not improved relative to 2024\u2019s poor result. Forecasted net written premium growth of 8.0 percent is 4.8 points above 2024 as premiums respond to recent performance.\u201d<\/li>\n<li><strong>Workers Compensation<\/strong>: In contrast to general liability, workers\u2019 compensation remains the strongest-performing major line in the P\/C industry. Preliminary 2025 results from NCCI show calendar year combined ratios in the range of 85\u201393 percent. Donna Glenn, Chief Actuary at NCCI, noted, \u201cIf this holds, it will represent 12 consecutive years of combined ratios under 100% for private carriers.\u201d For more details on the preliminary Workers Comp 2025 results, see NCCI\u2019s full analysis in <a href=\"https:\/\/www.ncci.com\/Articles\/Pages\/Insights-2025-in-Sight-2024-in-Review.aspx\">2025 in Sight, 2024 in Review: The Latest Results for Workers Compensation<\/a>.<\/li>\n<\/ul>\n<p><strong>Delving Deeper: A Members-Only View<\/strong><\/p>\n<p>For members who want to dig deeper into the projections, the full <em>Insurance Economics and Underwriting Projections: A Forward View<\/em> report offers a more granular analysis, including:<\/p>\n<ul>\n<li>A detailed look at personal auto and commercial auto results, breaking down the quarterly experience between auto liability and physical damage.<\/li>\n<li>A forecast of net combined ratio and net written premium growth specific to farmowners insurance.<\/li>\n<li>A comparison of commercial property sub-lines.<\/li>\n<li>A breakdown of commercial multiple peril results, differentiating between property and liability performance.<\/li>\n<\/ul>\n<p>The next quarterly report will be presented at a members-only webinar in January 2026.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By William Nibbelin, Senior Research Actuary, Triple-I The U.S. property\/casualty (P\/C) insurance industry is on track for a second consecutive year of underwriting profitability in 2025, and is projected to grow faster than the broader U.S. economy, according to the latest Insurance Economics and Underwriting Projections: A Forward View report from Triple-I and Milliman. The&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-2098","post","type-post","status-publish","format-standard","hentry","category-auto-insurance"],"_links":{"self":[{"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/posts\/2098","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/comments?post=2098"}],"version-history":[{"count":1,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/posts\/2098\/revisions"}],"predecessor-version":[{"id":2099,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/posts\/2098\/revisions\/2099"}],"wp:attachment":[{"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/media?parent=2098"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/categories?post=2098"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/egocene.com\/index.php\/wp-json\/wp\/v2\/tags?post=2098"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}