The U.S. property insurance industry has returned to profitability after a tumultuous year in which it addressed climate-related shocks by raising rates and dropping coverage in disaster-prone areas.
After sustaining huge losses from disasters starting in 2020, property insurers drew national attention — and outrage — in 2023 with unprecedented premium hikes and withdrawals from risky parts of California, Florida and elsewhere.
But the moves helped the industry turn a $9.3 billion profit in the first quarter of 2024 compared with an $8.5 billion loss a year ago, according to a report released Thursday by the ratings agency AM Best. The report does not assess investment returns, which are insurers’ other major revenue source.
In a separate report, Moody’s Ratings boosted its outlook for the property insurance sector to “stable” from “negative,” noting that insurers “significantly increased” rates. Its outlook report, released Monday, reflects industry trends and does not have the significance of ratings that grade an individual insurer’s financial health.
