U.S. property/casualty insurers' reserves steady for 2014: Moody's
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Reserves among U.S. property/casualty insurers will remain “moderately redundant” at year end 2014, with some differentiation among companies and business lines, Moody's Investors Service Inc. said in a report released Thursday.
Accident year 2014 reserves among standard commercial liability lines will be “modestly redundant” as premium rates have outpaced loss cost trends for the fourth year in a row, according to the report.
The report said there is a range of reserve strength among the top 25 property & casualty insurers, which make up about 60% of the industry's core reserves. Insurers range from showing “significant redundancies” to showing “moderate deficiencies,” said Moody's in “US P&C Reserves — Personal Lines Strong, Commercial Slowly Improving”
“The estimated reserve position varies significantly among the top 25 companies, ranging from a redundancy of slightly over 12% to a deficiency of about 6% of carried reserves,” Moody's said in its report.
Commercial auto and workers' compensation lines continue to see reserve deficiencies, according to the report.
“We estimate core commercial auto liability reserves are deficient by about 2%-3% of carried reserves with an overall modest deficiency in workers' compensation of about 1% as of year-end 2013,” Moody's said in its report.
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