| Amount | Percent of total investments |
|---|
| Investment type | 2020 | 2021 | 2022 | 2020 | 2021 | 2022 |
|---|
| Bonds | $1,111,622 | $1,178,226 | $1,144,666 | 55.38% | 53.02% | 55.31% | | Stocks | $536,272 | $657,175 | $574,911 | 26.71% | 29.58% | 27.78% | | Preferred | 16,515 | 17,447 | 15,968 | 0.82 | 0.79 | 0.77 | | Common | 519,757 | 639,728 | 558,943 | 25.89 | 28.79 | 27.01 | | Mortgage loans on real estate | $23,660 | $27,021 | $25,729 | 1.18% | 1.22% | 1.24% | | First liens | 23,298 | 26,526 | 25,114 | 1.16 | 1.19 | 1.21 | | Other than first liens | 362 | 495 | 615 | 0.02 | 0.02 | 0.03 | | Real estate | $13,739 | $13,301 | $12,655 | 0.68% | 0.60% | 0.61% | | Properties occupied by company | 9,151 | 8,875 | 8,151 | 0.46 | 0.40 | 0.39 | | Properties held for income production | 4,297 | 4,017 | 4,143 | 0.21 | 0.18 | 0.20 | | Properties held for sale | 290 | 409 | 361 | 0.01 | 0.02 | 0.02 | | Cash, cash equivalent and short-term investments | 140,244 | 156,464 | 148,026 | 6.99 | 7.04 | 7.15 | | Derivatives | 537 | 609 | 1,274 | 0.03 | 0.03 | 0.06 | | Other invested assets | 175,007 | 180,263 | 157,110 | 8.72 | 8.11 | 7.59 | | Receivable for securities | 2,326 | 3,177 | 2,680 | 0.12 | 0.14 | 0.13 | | Securities lending reinvested collateral assets | 4,537 | 6,520 | 3,085 | 0.23 | 0.29 | 0.15 | | Aggregate write-in for invested assets | -547 | -711 | -749 | NA | NA | NA | | Total cash and invested assets | $2,007,396 | $2,222,046 | $2,069,387 | 100.00% | 100.00% | 100.00% |
|
(1) Includes cash and net admitted assets of property/casualty insurers.
NA=Not applicable.
Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.
FAQs
Property/casualty insurers invest primarily in safe, liquid securities, mainly bonds. These provide stability against underwriting results, which can vary considerably from year to year. The majority of bonds are government issued or are high-grade corporates.
What are the P&C trends in 2024? ›
P&C Insurance Trends in 2024
P&C insurers are increasingly turning to AI to streamline operations and enhance customer interactions. AI-powered solutions are being utilized to automate repetitive tasks, improve process efficiency, and provide personalized experiences for policyholders.
What type of investments do insurance companies make? ›
Debt securities: bonds, notes, and redeemable preferred stock. Equity securities: common stock, mutual fund shares, and non-redeemable preferred stock. Short-term investments: commercial paper, certificates of deposit, mutual funds, and money market funds. Securities lending and repurchase agreements (repos)
Is P&C insurance growing? ›
We raise our premium growth estimate to 7.0% for 2024 (from 5.5%) and forecast 4.5% growth in 2025. We forecast industry ROE of 9.5% in 2024 and 10.0% in 2025. Personal lines are the anticipated key driver of growth this year; commercial lines are bifurcated, with strong property growth offset by weak liability growth.
How do P&C insurers make money? ›
Most insurance companies generate revenue in two ways: Charging premiums in exchange for insurance coverage, then reinvesting those premiums into other interest-generating assets. Like all private businesses, insurance companies try to market effectively and minimize administrative costs.
What are the two major sources of revenue for a property and casualty insurance company? ›
Major source of revenue to a property and casualty insurance company.
- Premiums. The major source of revenue for an insurance company is the periodical premiums paid to them by the policyholders.
- Investments. Another source of revenue is the money the insurance company earns from the investments it ventures into.
- Loss payments arising from claims – this constitutes the major expense category for most insurers. For P&C insurers, loss payments often represent 70 percent to 80 percent of their total costs.
What is the outlook for the property and casualty market in 2024? ›
Rate increase, capacity improvement variations. Alera Group's recent P&C Market Outlook shows that prices will continue to go up in 2024, with most lines of business likely to experience a 1%-10% increase.
How big is the US property and casualty market? ›
The market size, measured by revenue, of the Property, Casualty and Direct Insurance industry was $888.0bn in 2023. What was the growth rate of the Property, Casualty and Direct Insurance industry in the US in 2023? The market size of the Property, Casualty and Direct Insurance industry increased 0.7% in 2023.
What type of insurance is most profitable? ›
Life insurance is the most profitable—and the hardest—type of insurance to sell. With the highest premiums and the longest-running contract, it brings in cash over a long period of time. In the first year, agents make the largest annual sum on a policy, bringing in anywhere from 40–120% of the policy premium.
Investing in insurance companies
There are two primary reasons why you might want to consider investing in insurance stocks. First, insurance companies can deliver solid long-term returns. Second, the business models of insurers tend to make them resilient during economic downturns.
Do insurance companies invest in real estate? ›
Although insurers invest in a diverse set of industries, they have significant investments in industrial and manufacturing firms, financial firms, and real-estate-related securities.
Who is the biggest P&C insurer? ›
1. State Farm. State Farm is the industry's biggest player, both in the US and overseas. The Bloomington, Illinois-based P&C insurance giant wrote almost $78 billion worth of premiums in the past year.
What is the outlook for the P&C industry? ›
We expect 2023 to be a transition year for US P&C industry profitability, from a difficult 2022 to a stronger 2024 as higher premiums and interest rates improve industry results. The P&C industry has not yet reached the inflection point between premium growth rates and claims costs.
What do the top P&C insurance agents make? ›
While ZipRecruiter is seeing salaries as high as $77,966 and as low as $22,699, the majority of Property And Casualty Insurance Agent salaries currently range between $37,000 (25th percentile) to $53,800 (75th percentile) with top earners (90th percentile) making $63,655 annually in California.
What are the two major activity lines of property casualty insurance firms? ›
Property-casualty insurance includes two major categories: commercial lines and personal lines. Commercial lines include insurance products designed for businesses. Risks and hazards covered under commercial lines include malpractice insurance, professional liability, and builder's risk.
Why do property and casualty insurance companies invest more funds than life insurance companies in the money markets? ›
Answer and Explanation:
To achieve an adequate degree of liquidity, property/casualty insurers will usually structure their investment portfolios with a greater proportion of cash and cash equivalents, such as money market funds, than life insurers.
What do all property and casualty insurance policies contain? ›
Property and casualty insurance is a broad insurance, which includes coverage to your structure, property and belongings in the event of vandalism, theft, and more. If a thief were to break into your home, you would be protected up to your covered limits under your homeowners insurance policy.
