Insurers optimistic about year ahead

Posted: 2012-02-01

Insurers are expecting commercial lines to improve this year and are generally feeling optimistic about 2012, according to a recent study.

The Annual JP Morgan Deloitte report, which was published earlier this week (January 31), confirmed fears that many companies had recorded sharp losses in 2011.

Extreme weather conditions including floods in Queensland and Victoria, as well as cyclone Yasi in 2010-11 were said to have taken a toll on profits.

Yet despite this, it seems that change is in the air and a number of insurers are confident market conditions will improve this year.

"Looking forward, survey respondents expect to see the strong premium rate increases continue into 2012 in personal lines and were hopeful of increases again in commercial property, with expectations suggestions other classes remain competitive," asserted Deloitte actuarial partner Elaine Collins. 

Deloitte actuarial partner Stuart Alexander said that the majority of participants who took part in the research project are expecting commercial lines combined ratios to rebound by 11 per cent due to reductions in overall expense ratios, as well as positive adjustments to the post-disaster economic climate.

Issues that are of concern to insurers in the upcoming 12 months are regulatory restrictions, skilled staff, climate change and weather conditions.