The U.S. property/casualty industry grew its net underwriting income by 28 percent in the first six months of 2021 compared with the same prior-year period.

According to a new AM Best report, a 5.4 percent growth in net earned premiums and 55.3 percent decline in policyholder dividends offset increases in incurred losses and loss adjustment expenses and underwriting expenses, leading to the underwriting income increase.

AM Best said total net income grew almost 58 percent to $38.1 billion compared to the first six months of 2020 boosted by a $10.4 billion increase in realized capital gains.

The combined ratio for the industry improved by 0.8 percentage points from first-half 2020 to 96.9, with catastrophe losses representing 5.8 percentage points, compared with 6.5 in the same prior-year period, according to the report titled, “First Look: Six-Month 2021 Property/Casualty Financial Results.”

A 6.4 percent increase in net investment income and an additional $1.4 billion in other income, coupled with the improvement in underwriting income, drove a 14.1 percent rise in pre-tax operating income.

The data for this AM Best report is derived from companies’ six-month 2021 interim statutory statements that AM Best received as of Aug. 18, 2021, representing an estimated 97 percent of the total property/casualty industry’s net premiums written.

Source: A.M. Best

*This story ran previously in our sister publication Insurance Journal.