How has COVID-19 financially affected the P&C industry?

The property and casualty (P&C) insurance industry published financials for the second quarter (Q2) of 2020, which show a decline in net premium mainly attributable to COVID-19, reversing the growth the industry has experienced in recent years. The premium decline was accompanied by a slightly more than offsetting decrease in incurred losses and other underwriting expenses, resulting in a P&C industry combined ratio in Q2 2020 of 99%, a one-point improvement over the prior year.

The industry annual net premium growth for the past five years has averaged 5%. This growth has been, at least temporarily, halted by the pandemic. The aggregate industry net earned premiums for Q2 2020 are $12 billion lower than those for Q1 2020. The net incurred losses, loss adjustment expenses, and other underwriting expenses also decreased between Q1 and Q2.

Milliman professionals discuss the Q2 2020 results more fully in this article.