Falling interest rates and stalled premium growth mean the best returns on equity the property-casualty insurance industry can hope for in coming years will be in the high-single-digits, according to the president of the Insurance Information Institute, Robert P. Hartwig.
"Interest rates are lower than they were a decade ago. They're falling, and they're going to fall again," Mr. Hartwig said, noting that volatile stock market returns add to a bleak investment picture that has so far kept insurers focused on maintaining good underwriting results.
Addressing the Casualty Actuaries of Greater New York, Mr. Hartwig said the industry is expected to earn roughly $60 billion from its investment portfolio in 2007--including interest on bonds, stock dividends as well as realized and unrealized capital gains. This figure is no better than it was a decade ago, he noted, even though invested assets have grown in the intervening years.
Recommended For You
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.
