Most property/casualty insurance industry executives believe the worst of the financial crisis is over, according to an Insurance Information Institute (III) survey, which polled attendees at its Property/Casualty Insurance Joint Industry Forum.
Of those surveyed, 94 percent expect insurance industry profitability to improve this year, including 59 percent who expect improvement in personal auto and 61 percent who expect improvement in home insurance
. Most, 86 percent, don't expect improvement in workers compensation, and 76 percent don't expect profitability to increase in commercial lines.
In terms of inflation, 57 percent think it will increase. Slightly more than half of insurance industry executives, 53 percent, expect premium growth to remain flat, while 31 percent believe it will be positive and 16 percent believe it will be negative.
"Looking to 2011, exposures will continue the growth we saw in the second half of 2010 as the economy continues its recovery, implying increases in insurance premium volume," said Steven Weisbart, III senior vice president and chief economist in a statement. "Still, the low interest rate climate, which will likely persist throughout 2011, will challenge insurers to price risks in closer relation to their claims potential. Similarly, business bankruptcies might ease off in 2011 from two years of high rates but are likely to continue at troubling levels, so that the demand for commercial insurance in 2011 will rise from a smaller base than would otherwise have been the case."