The combined ratio for U.S. reinsurers improved nearly nine points for the first three months of the year, an association survey revealed.

Twenty-two domestic reinsurers queried by the Reinsurance Association of America posted an aggregate combined ratio of 89.9, compared with 98.4 for a similar group in the first three months of last year.

The reinsurers wrote $6.7 billion of net premiums during the first three months of the year, compared with $6.5 billion in the first quarter of 2006.

A report put out by Bank of America Securities underscored the improving reinsurance picture. Property-casualty analyst Kevin O'Donoghue said he is taking a more positive view of the industry following a discussion with 14 reinsurance brokers.

“We believe the market remains firm enough for reinsurers to write business at expected returns above historical levels and to produce strong book-value growth–the metric that ultimately drives success–through 2007,” he wrote.

In addition, the reinsurance industry's reserve position continues to be strong.

“The increases in incurred-but-not-reported reserves gives us confidence that continued prior-period development is more likely than adverse development at this time,” Mr. O'Donoghue wrote.

Special Reports /

U.S. Reinsurer Outlook Improves

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