US Property and Casualty (P&C) premium growth will rebound this year as a hard market in commercial lines augments growth from an economic recovery, the Insurance Information Institute (Triple-I) and Milliman say in a new report.

Last year’s coronavirus pandemic, civil unrest and weather-related catastrophes did not impact the industry to the extent originally feared, the study says, and new forecasts envision strong premium growth for this year and an underwriting result comparable to last year.

“The year ended surprisingly well given the difficult circumstances the industry found itself in,” Senior VP and chief actuary at Triple-I James Lynch said. “We project a slight underwriting profit in 2020, fairly similar to 2019. We project similar results over the next two years.”

US auto, homeowner and commercial insurers are forecast to achieve 1.9% growth in net premiums written and to book a combined ratio of 98.9% through year-end 2020. This year, net premiums written will increase 6.1% and the combined ratio will improve slightly to 98.5%, the two organisations project.

Continued underwriting profits through next year were forecast.

US P&C insurers turned in a profitable performance in the third quarter even as the industry’s net income dropped 26% for the second quarter in a row, according to Triple-I's Vice President and Senior Economist Michel Léonard.

“While it was below the 10-year average, it was overall stronger than expected given the structurally low-rate environment yields and equity market volatility,” Dr Léonard said.

“Prudent asset management and sound underwriting practices ensured the continued financial stability of the industry even as we faced a uniquely challenging year.”