The property/casualty industry experienced unprecedented investment losses in 2008 due to the overall worldwide economic downturn. Underwriting results also deteriorated significantly relative to recent history as a result of increased accident-year losses and above-average catastrophe losses.
Fitch's Rating Outlook remains Negative for the U.S. property/casualty insurance industry for both personal and commercial lines insurers. Near-term market fundamentals are not supportive of a return to strong underwriting profits and previous double-digit returns on surplus.
Investment returns are expected to remain inhibited by low yields and recognition of other-than-temporary impairments (OTTI) into earnings. Underwriting performance is likely to suffer from deteriorating accident-year loss experience, and diminished favorable prior period reserve development in 2009.
To access this Special Report, "Property/Casualty Industry Statutory Results And Forecast," please visit the Fitch Ratings web site at www.fitchratings.com under Financial Institutions > Insurance > Special Reports.