For 2025, Fitch expects the combined ratio for commercial lines to deteriorate slightly but still report an underwriting gain. (Credit: jijomathaidesigners/Shutterstock)
Underwriting performance for the U.S. commercial lines market in 2024 remained nearly flat from the previous year, Fitch Ratings reports. Overall, the industry saw a 97% combined ratio when excluding mortgage insurance and financial guaranty. This makes 2024 the fourth consecutive year the sector reported an underwriting profit.
Workers’ compensation remained the top performer among the major commercial segments, posting an 89% average combined ratio from 2020 to 2024. Fitch’s report notes that workers’ comp also remained the primary source of favorable reserve development last year. This was offset by adverse development in other commercial lines; notably commercial auto and other liability.
Net written premium for commercial lines has declined over the last four years; falling from 15% in 2021 to 4% in 2024, which is slightly below historic norms. Fitch expects revenue expansion will likely slow even further in 2025, excepting segments like general liability and commercial auto that have under-performed and are likely to continue generating significant rate increases.
For 2025, Fitch expects the combined ratio for commercial lines to deteriorate slightly but still report an underwriting gain.
A full copy of Fitch’s U.S. Commercial Lines Monitor for year-end 2024 is available here.
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