MarketsMar 11, 2025
As the Wider Market Sinks, the Personal Casualty Insurance Business Is Popping to Start 2025 — Bolstered by Higher Premiums
Underwriting Trends
Noah Weidner
Discover
It’s too bad that investors can’t buy themselves insurance against sagging markets, only they can — by investing in property and casualty insurers, which have surged 7% to start 2025. After three consecutive years of losses on skyrocketing home and auto prices, the industry’s higher premiums are finally starting to catch up with costs.
What’s the upside? Across the industry, premium hikes are seen offsetting years-long underwriting losses, with motor vehicle insurance up 12% year-over-year and single-family home insurance up 14% (WSJ). The combined ratios — considering the cost of all claims and expenses — for auto insurers showed the wider industry making a modest underwriting profit last year, while homeowners policies generated a small loss. How 2025 will crank out, however, will be a matter of great unknowns — factors like wildfires, hurricanes, hail damage, auto accidents, and the like. But investors are coming along for the ride, with the iShares US Insurance ETF up 5.3% YTD.
