I.I.I.: P/C Executives Expect Improved Profitability in 2012

Most P/C insurance executives believe the worst of the financial crisis is over and that the industry is now in the early stages of a hard market, according to a survey from the Insurance Information Institute.

The I.I.I. conducted the survey at its 16th annual Property/Casualty Insurance Joint Industry Forum, held earlier this month in New York. Some 260 senior insurance executives attended the event.

The survey found 75 percent of executives in the P/C industry expect an improvement in profitability in 2012. And 72 percent believe the industry is on the road to recovery. Broken down by lines of insurance, 63 percent of respondents believe there will be an improvement in personal auto and 67 percent expect an improvement in homeowners. While 72 percent of respondents expect an improvement in commercial lines, 55 percent do not expect an improvement in workers compensation.

The I.I.I. said 67 percent of respondents believe that premium growth will be higher; 31 percent believe it will remain flat, and only 2 percent believe it will be negative. In terms of capacity, as measured by policyholders’ surplus, 56 percent of respondents expect it to increase; 35 percent believe it will remain flat; and 9 percent believe it will decrease. As compared with 2011, 78 percent of respondents believe the combined ratio will be lower in 2012.