According to Stefan Holzberger, Chief Rating Officer at A.M. Best, the property-casualty sector of the insurance industry saw improvements in performance. And with levels of capitalization “robust”, A.M. Best is maintaining a “Stable Outlook” on the Personal Lines, Commercial Lines and Reinsurance sector from a credit perspective. The reinsurance sector was only recently upgraded to “Stable” from “Negative”, despite heavy …

Andrea Keenen, Senior Managing Director and Head of Industry Relations at A.M. Best Company, shares her thoughts on the “protection gap”, technology, and the impact of economic growth on insurance. The “protection gap” exists around the world, including the United States. Many people are simply not buying the insurance they need. She notes that governments around the work and the …

Kimberly Muccia, a Financial Analyst at A.M. Best Company, comments on the impact of catastrophic losses on the financial strength of insurers. Among the catastrophes affecting the auto and homeowner lines of business in 2018 were hurricanes and wildfires, resulting in about $17 billion for the Mutual Insurance segment alone. Despite the losses, Mutuals posted approximately a 6 percent increase …

Attracting talent remains biggest challenge for insurers. According to Matt Masher, EVP and COO at A.M. Best, the need for talent is greatest in the information technology (IT) area. The industry has done a lot to attract underwriting and claims professionals. But attracting the industry struggles in attracting IT talent needed to deal with insurtech issues, efficiencies in distribution and …

The 2016 Monte Carlo Rendez-vous drew many of the industry’s top reinsurance professionals to discuss the state of the market. The top ratings agencies also released their verdict on the market. A.M. Best maintained its negative outlook due to weak operating fundamentals exacerbated by continued weakened demand from primary insurers as they retain more business to leverage their own excess capacity. According to …

A.M. Best Assistant Vice President Greg Reisner discusses the rating agency’s ‘negative’ outlook for the global reinsurance sector and the new realities facing the market due to convergence capital and mergers and acquisitions. According to Best’s Assistant Vice President William Pargeans, the life reinsurance segment outlook remains ‘stable’ despite consolidation that has left the market top heavy with lower cession …

A.M. Best Vice President Andrew Colannino explains the rating agency’s ‘negative’ outlook on the commercial lines segment of the U.S. property/casualty (P&C) industry, despite relatively solid aggregate results over the past several years. He says A.M. Best’s expects more downgrades than upgrades in the coming year. The negative outlook largely reflects the concerns that have been prevalent in recent years: …

In highlights from a recent “First Monday” episode, A.M. Best Managing Director, Analytics Greg Carter discusses the top issues affecting the European insurance markets, including technology, product design and regulation. According to Mr. Carter, there are several overarching issues impacting the UK and Europe markets, including the fragile economies in the Eurozone amid shifting regulations. He sees long-term opportunities for insurers …

In highlights from A.M. Best’s First Monday series, A.M. Best Senior Financial Analyst Thomas Zitelli and Financial Analyst Frank Walko discuss how the U.S. Life/Health insurance market performed in 2014, exploring positive retirement market trends amid interest rate and reinvestment risks. While the Life/Health industry demonstrated the ability to handle its business very well during a slow growth environment, it …

In highlights from the First Monday series, A.M. Best Senior Financial Analysts Kate Stefanelli and Michael Adams discuss the precarious funding of the Social Security Disability Income program and the potential impact on disability insurers. The Social Security Board of Trustees has projected that funding for the Social Security Disability Income program will run empty in 2016. According to Ms. …

The commercial use of drones is expected to grow rapidly as companies like Amazon and UPS look to use drones to support their activities. Drones can potentially change business models for a number of industries, including insurance. Here, A.M. Best AVP Henry Witmer discusses the use of drones, related liability exposures and the underwriting challenges insurers face. According to Mr. …

In highlights from the First Monday series, A.M. Best’s Senior Economist Meg Mulry looks at development of international capital standards (ICS) by the International Association of Insurance Supervisors (IAIS), and the timeframe for adoption. Ms. Mulry notes that the Financial Stability Board (FSB) and the IAIS have identified nine insurance companies that are deemed systemically important. She says the regulators …

In highlights from its First Monday series, A.M. Best’s Senior Financial Analyst Dan Teclaw discusses the profitable Medical Professional Liability (MPL) market. According to A.M. Best, 2014 was the ninth straight year of underwriting profit, significant rate increases and tougher underwriting. Mr. Teclaw sees medical professional liability premiums coming down due to competition, and the market is slowing He notes …

Mergers and Acquisition activity shows no signs of slowing down. Here Assistant Vice President William Pargeans and Vice President Robert DeRose discuss the motivations of insurers, across sectors, to seek out mergers and acquisitions. According to Mr. Pargeans the life insurance industry is very mature and the only way for insurers to grow in this sector is to buy blocks …

In highlights from a recent edition of A.M. Best’s First Monday series, Senior Financial Analyst Doniella Pliss discusses the risk-sharing provisions of the Patient Protection and Affordable Care Act (ACA). According to Ms. Pliss, there are three risk stabilization programs for the ACA: Risk Corridor, Reinsurance and Risk Adjustment. “The goal of the Risk Corridors program was to protect the insurer from …

Assistant Vice President Rosemarie Mirabella in a recent edition of A.M. Best’s First Monday series discusses Variable Rate Annuities and the concerns over legacy blocks of business. According to Ms. Mirabella A.M. Best’s concern is “primarily centered around the tail risk as it relates to the embedded richness of the guarantees, the equity market risk, interest rate risk and… policyholder …

In a recent edition of A.M. Best’s First Monday series, Vice President Rich Attanasio discusses how usage-based data and advances in automobile technologies are driving changes in the U.S. personal automobile sector. The advancement of safety features in vehicles is having a positive impact in regards to frequency trends in the personal automobile sector said Mr. Attanasio. New technologies including crash avoidance …

In highlights from the First Monday series, A.M. Best Assistant Vice President Joseph Zazzera and Senior Financial Analyst Bridget Maehr discuss how health insurance carriers are navigating health reform provisions that began in 2014, and the sector’s “stable” outlook. More than 11 million people have selected health plans through the Affordable Care Act (ACA) in 2015, 3.1million more than in …

In highlights from the First Monday series, A.M. Best VP Robert DeRose, along with Senior Financial Analysts Greg Reisner and Mariza Costa, discuss the M&A trend among global reinsurers and the desire for scale and relevance. For some reinsurers, Mr. Reisner says M&As are part of a strategy, while others see it as an “ultimatum” because current strategies are not …

There is a mixed outlook for the U.S. Property and Casualty industry according to A.M. Best. While the industry as a whole is on its second straight year to a strong performance competitive pressure and emerging risks could impact insurers bottom lines. Here, Group Vice President Anthony Diodato discusses the reasons for concern for the U.S. Property and Casualty Industry …