Situation Is Improving Somewhat For Insurance Industry
Overall the situation is starting to improve for insurers across many different sectors. While premiums continue to fall and underwriting levels are down due to the recession, the partial rebound of the stock market has seen the value of many firms investment portfolios recover somewhat.
Let’s be realistic, investment income has been the industry’s bread and butter for some time now and the nearly 40% drop in the stock market during the recession caused some worrisome times for many insurance sectors. Of course the bond and mortgage insurance sectors are still having a fairly rough time of it but that will likely continue until the credit system and housing market returns to normal.
Also the upcoming regulatory shakeup is likely to include some form of federal supervision, something the industry has long sought. Right now, states are in charge of insurance regulation and many firms dislike have to deal with the conflicting rules and individual rate setting that is required with the fifty different states.
That being said, it will still be some time before the industry fully recovers from the financial crisis. They are likely to see a period of slow growth for many years to come.
