April 2013/5

The profitability of US P&C insurers nearly doubled year-on-year in 2012 despite Superstorm Sandy and poor investment performance, according to data published jointly by ISO, the Property Casualty Insurers Association of America (PCI) and the Insurance Information Institute (III).

The first quarter reporting season is due to kick off in London this week with a trading statement from Novae on 1 May.

The resurgent Lloyd's (re)insurer Novae is under pressure from analysts to change its reserve disclosures after its unusual approach to accounting assisted its extraordinary 2012 outperformance.

Reinsurers expect the traditionally lucrative Florida reinsurance market to offer attractive premiums despite fears of a particularly competitive 1 June renewal.

Aside from pricing, Q1 earnings calls have focused on how best to utilise excess capital in the sector and on strategies for improving investment returns in what remain challenging conditions for finding adequate yield.

A hectic week for equity analysts jumping between US P&C industry earnings calls provided plenty of evidence from senior management of sustained momentum for commercial insurance rate increases.

Aon maintained its organic growth momentum in the first quarter as net income from continuing operations rose 9.6 percent to $261mn and earnings per share increased by 13 percent to $1.11.

Global broker Aon hailed the success of its heavy investment in new services last week as it posted increased retail brokerage growth in the US and the wider Americas in its first quarter results.

The 15 April terrorist attack in Boston has emphasised the need to reauthorise the Terrorism Risk Insurance Program (TRIPRA/TRIA), according to insurance executives attending the RIMS convention in Los Angeles last week.

The resolve shown by commercial heavyweight Chubb is a key factor behind the renewed discipline in the directors' and officers' (D&O) market that has prompted across-the-board rate increases, according to numerous market sources.

As (re)insurance executives at the RIMS conference in Los Angeles last week struggled to find a catch-all phrase to sum up the current US P&C pricing dynamics, one word that was increasingly used was "rational".

The Insurance Council of Texas estimates that the total insurance bill from an explosion at West Fertilizer's plant in West, Texas, last week may reach $100mn.