An investment analyst said homeowner insurers should benefit from the drop in new home construction by lowering the cost for building replacement homes, but the economic slowdown could increase losses in other areas.
In an analyst's note, Meyer Shields with Stifel Nicolaus said the economic slowdown in the housing market will lead to some increases in areas of loss, but home insurers are "more able and more willing to maintain underwriting profitability for the line of business than in the past."
According to what he termed as rough analysis of trends affecting the housing market, prices for nonpetroleum construction products are in decline.
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