The U.S. property/casualty (P/C) insurance industry posted a net combined ratio of 96.6 in 2024, a 5.1-point improvement from the previous year and its strongest underwriting result since 2013, according to a report by the Insurance Information Institute (Triple-I) and Milliman.
The report noted gains across personal and commercial lines. Personal auto recorded a 95.3 net combined ratio, reflecting improved underwriting supported by net written premium growth of 14.4% in 2023 and 12.8% in 2024. The homeowners line reported a net combined ratio of 99.7, its first result below 100 since 2019, alongside its strongest premium growth in over 15 years.
While 2024 showed improved performance, industry outlooks for 2025 are more cautious. General liability posted a 110 net combined ratio, driven in part by adverse prior-year development.
Jason B. Kurtz, principal and consulting actuary at Milliman, said more than $9 billion in reserve strengthening contributed nine points to the 2024 result, the highest reserve increase in at least 15 years. He also noted that recent hard-market policy years continue to see additional reserve needs.
Workers’ compensation remained stable, benefiting from favorable development for the eighth straight year. Donna Glenn, chief actuary at the National Council on Compensation Insurance, said the line remains financially sound but pointed to early signs of potential challenges.
Looking ahead, losses from January wildfires in Los Angeles County are expected to weigh on first-quarter 2025 results. Tariff impacts are also beginning to affect underlying growth and replacement costs across multiple lines, including personal auto, homeowners, commercial auto, and commercial property.
Triple-I chief economist Michel Léonard said the P/C sector’s underlying economic growth is expected to reach 5% in 2025, outpacing the broader U.S. GDP forecast of 2.5%. Replacement cost inflation is projected at 1.0%, below the 2.0% forecast for the Consumer Price Index. However, Léonard cautioned that tariffs could reverse this trend, adding pressure to underwriting and potentially limiting the benefits of future premium increases.
