Fitch sees life and P/C sectors as neutral for 2023
Rising interest rates are positive for all life insurance product lines, Tucker said. In addition, he said, Fitch expects to see fixed indexed annuity sales volumes to remain strong in 2023, coming off a year of strong sales growth in 2022.
Also looking ahead to 2023, Tucker said Fitch expects to see more life insurers divest themselves of non-core blocks of business.
Fitch views the P/C market as continuing its hardening phase, in which the market cycle is on an upswing, premiums are increasing and carriers’ capacity for most types of risk is decreasing. That was the word from Brian Schneider, Fitch senior director.
Premium growth remained strong in 2022, he said, and 2022 saw a widening divergence in underwriting results between commercial lines and personal lines sectors.
Commercial lines should remain profitable in 2023, he said, but the sustainability of underwriting results is less likely given inflation.
Personal lines showed record profits in 2022, Schneider said. Personal auto lines showed losses in 2021 and 2022 due to the effects of high inflation and supply chain challenges.
Homeowners lines were impacted in 2022 by inland storms, wildfires and Hurricane Ian. Higher labor and material costs also had an adverse effect on homeowners lines.
Schneider said Fitch predicts P/C written premium income will be lower in 2023 than in the prior year. The industry’s underwriting loss is expected to move closer to the break-even point in 2023.
Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents’ association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.
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