Connect with us
Finance Digest is a leading online platform for finance and business news, providing insights on banking, finance, technology, investing,trading, insurance, fintech, and more. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

NEWS

US homeowners premium set to surpass $90bn for the first time, according to annual Aon study

Published On :

Aon Benfield, the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON), today launches its annual Homeowners ROE Outlook report, which forecasts continued growth in direct U.S. homeowners insurance premiums for 2016 despite a decreasing return on equity for insurers.

The report reveals that U.S. homeowners premiums increased from USD74 billion in 2011 to USD89 billion in 2015, and will rise to a projected USD91 billion for 2016 given prospective rate activity. The study shows that homeowners insurers secured an average rate increase of 2.0 percent during the 18 months to August 2016, with rate decreases experienced in the states of Florida, Arizona, Indiana, Ohio, Alabama, and Alaska.

The prospective after-tax return-on-equity (ROE) for U.S. homeowners business was shown to be 6.7 percent on a countrywide average (2015: 8.6 percent), and 10.9 percent excluding the state of Florida (2015: 12.6 percent). ROEs are expected to exceed 10 percent in 34 US states – enabling carriers to cover their cost of capital – compared to 36 states in 2015.

The report highlights that a continued decrease in reinsurance pricing has offered insurers the opportunity to more extensively utilize traditional and non-traditional reinsurance in their capital strategies and pursue growth opportunities in this highly competitive sector.

However, the negative effects of lower investment yields, higher expenses, and an increase in the catastrophe loss ratio resulting from updates to vendor catastrophe models, are causing insurers to place a greater emphasis on underwriting performance and the development of effective strategies in pricing, claims management, marketing and risk selection.

Greg Heerde, Head of Americas Analytics for Aon Benfield, said: “Our study reveals that at prospective 2017 rates, homeowners insurance provides accretive returns in the majority of states, and opportunities exist for insurers to pursue profitable growth in the line.

Parr Schoolman, Head of Aon Benfield’s Risk and Capital Strategy team, added: “We are continuing to develop tools and services to help provide clients insight, at a granular level, into which homeowners risks are most likely to be profitable.

Developed by Aon Benfield Analytics and updated annually, the Homeowners ROE Outlook report provides a comprehensive analysis of the U.S. homeowners insurance sector, based on industry aggregate state level statutory financial filing information along with rate filings and supporting actuarial information for the 20 top U.S. homeowners insurance groups by state.

To view the 2016 Homeowners ROE Outlook report, please click on the flowing link: http://aon.io/2epnz2k

Continue Reading

Why pay for news and opinions when you can get them for free?

       Subscribe for free now!


By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Posts