NU Online News Service

U.S. life carrier mortality has been remarkably low.

Only 3 life insurance companies and 3 health carriers failed in 2005, and the companies that did fail were small, according to a report by analysts at Standard & Poor's, New York.

The number of life insurer and health carrier failures was the same as in 2004, and the only failed life insurer rated by S&P had just $12 million in assets.

Despite the effects of Hurricane Katrina, only 10 property-casualty insurers failed in 2005, down from 13 in 2004, and none of the p-c carriers domiciled in Louisiana or Mississippi was placed under regulatory supervision last year.

Although the total number of failures dropped only 19%, the asset value of the top 5 2005 failures amounted to just $112 million, down from $5.3 billion in 2004.

"Such favorable trends, however, are not sustainable over the long term," S&P analysts warn in the report.

Elsewhere in the report, the analysts predict that the quest for scale will encourage life insurers to continue to consolidate during the coming year.

Special Reports /

S&P: Few Insurers Failed In 2005

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