Net income for the US general insurance industry increased 29.1% on the previous year, with a record $US30.93 billion earned in the first half of 2005.

An analysis provided by the Insurance Services Office (ISO) and the Property Casualty Insurers Association of America showed that the consolidated surplus for the industry increased 4.7% to $US412.51 billion at June 30, rising from $US393.89 billion at the end of last year. It’s the first time the industry’s income has surpassed any other six-month period since 1986, when the ISO began its quarterly records.

“The industry’s strong performance in the first-half 2005 could not have come at a better time for insurers now facing billions and billions of dollars in insured losses from Hurricanes Katrina and Rita,” the Insurance Information Institute said.

On the whole, the industry recorded an underwriting profit of $US13.22 billion during the first six months, an increase of 43.5% over the previous year’s period, and this helped lower the industry’s combined ratio to 92.7% from 94.3%.

Recent insured loss claims from Katrina and Rita could have cut the industry’s rate of return for 2005 by as much as 8% if US insurers had to shoulder the entire burden, according to Insurers Association VP Gregory Heidrich.

“Once we have good estimates of the losses that will be covered by foreign reinsurers and residual market mechanisms, we’ll be able to develop a more precise assessment of the financial impact of Katrina and Rita on the domestic insurance industry.”