Growth in net ea
rned premiums during the first three months of 2025 was offset by
losses and expenses, resulting in a $1.1 billion net underwriting loss o
f the U.S. P/C industry.
According to indust
ry rating agency AM Best, the January wildfires in California were to
blame for the increase in losses for personal and
commercial insurance lines in the first quarter.
Losses incurred during Q1 were about $147.1 billion, up about 17
% from the same period a year ago. Losses and loss adjustment expe
nses (LAE) were up 15.
8% to about $167.5 bi
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llion, which significan
tly offset a 7.8% increase in net premiums earned to $226.3 billion, said
AM Best in a first look at industry financial results.
Q1 net investment income of $20.5 billion was up just 2.4% from Q1 2024.
Net income dropped more than 50% to about $19.8 billion during Q1 2025.
The industry’s combined ratio worsened to 99.4 from 94.4 during Q
1 2024. Excluding $9.6 billion of favorable reserve development during Q1, the combined ratio was 103.6.
AM Best the first quarter analysis was based on company reports received by May 29. These insurers represe
nt about 96% of both the industry’s total net
premiums written and industry surplus, which increased 6.9% to about $1.1 billion.