2 minute read
S&P Warning — The Combined Ratio Could Top 100% in 2022
S&P WARNING
THE COMBINED RATIO COULD TOP 100% IN 2022
Advertisement
A new report from S&P Global Market Intelligence says property and casualty insurers could see a combined ratio of 100.4% by the end of the year. If things unfold as S&P predicts, the P&C industry could see its first unprofitable year since 2017. That’s unprofitable from an underwriting standpoint.
The line of insurance that is being hit hardest right now is private auto. It will account for 35% of the net P&C premiums written this year. Auto insurers have been hard hit all year by high vehicle prices, parts and interruptions in the supply chain.
Commercial lines are — in some ways — offsetting that concern. Those lines did very well in 2021 and the combined ratio of 96.1% last year is the best commercial lines have done since 2015. S&P predicts an equal performance by the end of 2022 and says commercial lines will likely end up with a slightly higher combined ratio of 96.3%.
In spite of a report that spills a lot of gloom and doom, S&P says by 2023 insurers will go back to moderate profitability and a combined ratio of 99.7%. There is a caveat to that statement. This will only happen if there are meaningful increases in important lines.
Another asterisk comes in the form of worries about inflation and private auto insurance claims costs that continue to rise.
One worry the report doesn’t have is high gas prices. Those prices are going to keep people from driving more and that will drive down claims.
Sources: PropertyCasualty360.com and Insurance Journal
About Us
PIA Design & Print offers a one-of-a-kind relationship between you, your brand, and our diligent, creative and unique team of hardworking professionals whose top priority is building your business. With your input, we forge the path between you and your future clients, reliably growing your brand into a name people know and trust.
Formerly known as Creative Services, Design & Print works closely with your small business, insurance agency or association. We help grow your business by focusing on marketing you, your brand, and the services that you provide.
Contact Design & Print today to make the most of your business. You are important to us—let us show you!
