New reporting from McKinsey indicates that too many insurers are taking risk-aversion too far and in the process they are widening the current protection gaps. (freshidea/Adobe Stock) New reporting from McKinsey indicates that too many insurers are taking risk-aversion too far and in the process they are widening the current protection gaps. (freshidea/Adobe Stock)

First, the good news: Since 2019, personal property and casualty (P&C) insurance revenues have grown an average of 3% a year, and the industry proved its resilience during the pandemic. From 2016 to 2021, personal carriers saw a 5 % improvement in their operating expenses.

And now, the not-so-good news: In 2021, half of P&C insurers were not earning their cost of equity, and most listed insurance companies were trading below book value, raising questions about their business models. P&C profits are still down about 10% since 2019.

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