U.S. P/C Insurance Achieves Best Underwriting Results Since 2013 Amid 2025 Cautions

The U.S. property/casualty insurance industry improved its underwriting performance in 2024, posting a net combined ratio of 96.6, the best since 2013, with gains in both personal and commercial lines. Personal auto insurance showed a 95.3 combined ratio, driven by strong premium growth, while homeowners' insurance achieved its first sub-100 combined ratio since 2019 alongside robust premium increases. General liability experienced a higher combined ratio of 110 due to adverse prior-year reserve developments, which contributed significantly to the industry's results, marking the largest reserve strengthening in over 15 years.

Workers' compensation remains stable with favorable development trends, though early challenges have been noted. Looking ahead to 2025, the industry faces potential headwinds from wildfire losses impacting early results and tariff-related cost pressures affecting growth and replacement costs across multiple lines. Economic growth for the property/casualty sector is forecasted at 5%, outpacing the general U.S. GDP expansion, but tariff inflation may challenge underwriting profitability and premium gains.