Property-Casualty Industry Loss Reserves Remain Redundant in 2023; Favorable Development Slightly Lower than Prior Year
August 19, 2024
HARTFORD, CT – August 19, 2024 – Conning’s annual study of the property-casualty industry’s loss reserves finds that overall reserves remain redundant, and reserve adequacy levels vary considerably by line of business.
“The key line contributing to the industry’s redundancy remains workers compensation,” said Robin Davis, a Director of Insurance Research at Conning. “Reserve adequacy declined for most lines. The exceptions were workers compensation, other liability (occurrence and claims made), and commercial auto where reserve adequacy improved modestly in 2023. Outside pressures are adding uncertainty to the reserving process.”
The Conning study “2023 Property-Casualty Loss Reserves: Outside Pressures Adding Uncertainty” reviews the property-casualty industry’s loss reserve position at the end of 2023, by line of business and in total. The study includes Conning estimated ranges of reserve adequacy levels for the industry overall and for small, mid-sized, and large insurance company size cohorts. Conning also discloses which companies contributed the largest amounts of favorable and adverse development for each line of business.
“The industry experienced favorable loss development of $2.3 billion in 2023, less than the favorable $3.4 billion prior year development in 2022,” said Scott Hawkins, the Head of Insurance Research at Conning. “This is the eighteenth consecutive year of favorable development from prior accident years. The other liability line moved from slightly deficient in 2022 to slightly redundant in 2023. However, the commercial auto liability line remains deficient.”
“2023 Property-Casualty Loss Reserves: Outside Pressures Adding Uncertainty” is available for purchase from Conning by calling (888) 707-1177 or by visiting here.
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Conning (www.conning.com) is a leading investment management firm with a long history of serving the insurance industry. Conning supports institutional investors, including insurers and pension plans, with investment solutions, risk modeling software, and industry research. Founded in 1912, Conning has investment centers in Asia, Europe and North America.
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