Commercial underwriting results likely worsened in 2024: Report

U.S. commercial insurers are projected to see a deterioration in underwriting results for 2024, which was marked by losses from Hurricane Milton and rising general liability losses.

The net combined ratio for commercial property is expected to worsen by 3.3 points to 91.2% when insurers publish their full-year results, according to a report released Thursday by the Insurance Information Institute and Milliman Inc. Travelers Cos. Inc., the bellwether among commercial insurers, will report its 2024 results next week.

Hurricane Milton, which struck Florida’s Gulf Coast as a Category 3 hurricane in October, was the worst catastrophe for commercial insurers since Hurricane Ian in 2022, the report said. According to a recent report by Munich Reinsurance Co., the storm caused $25 billion in insured losses.

The combined ratio for general liability business is expected to deteriorate 3.6 points to 103.7%, the III/Milliman report said. In recent years, liability insurers have raised concerns over so-called social inflation, or rising court awards and settlements.

Looking forward, the underlying economic growth of the property/casualty industry, at 2.3%, is expected to outpace overall gross domestic product, which is projected to grow by 2.1% this year, as lower interest rates continue to revive real estate and increase demand for cover, the report said.