NU Online News Service, July 21, 2:00 p.m. EDT
As reserve releases slow, accident-year losses rise, and investment yields weaken, property and casualty insurers may need to reconsider cost reductions in the form of cutting salaries and advertising budgets to improve profitability, according to a Keefe, Bruyette & Woods industry update.
While the industry is not yet talking about cost cutting, KBW says, the lack of growth may force the issue. “Many companies already went through a round of layoffs and cost cuts in 2008-09—always a painful effort and not one which management teams want to go through again,” the firm notes.
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