RJ and Makay

Good news for the P&C industry: an overwhelming majority of industry executives — 94% — believe the worst of our economic woes are over and 2011 will be more profitable.

That's a key finding of a survey of 100 P&C executives by the Insurance Information Institute (I.I.I.). The survey findings were presented recently at the I.I.I.'s 15th annual Property/Casualty Insurance Joint Industry Forum in New York City.

Although net income dropped 3% for the P&C insurance industry as a whole in the third quarter, it has spiked very nicely -- by 62% -- in the past nine months. So says a recent report produced jointly by the Property and Casualty Insurers Association of America, Insurance Information Institute, and Insurance Services Office (ISO).

"It is now all but certain that the P&C insurance industry will record positive growth in 2010 -- the first (time) since 2006,” says Robert P. Hartwig, president of the Insurance Information Institute, which is based in New York City. “While underwriting losses deteriorated marginally, the industry is still operating on a ‘break-even’ basis with a combined ratio of 99.7, after excluding mortgage and financial guaranty insurers.”

Some sobering news for the commercial lines P&C industry: The soft market isn't likely to loosen its grip on the industry in the near future and will probably persist through 2011.

According to "The Insurance Market in 2011: The Lingering Effects of the Recession Fuel Competition,” a report by consulting firm Advisen, commercial lines P&C insurance companies saw their pricing gains of the 2001-2003 hard market disappear during the Great Recession. Though it may seem there's nowhere for today's rock-bottom prices to go but up, the current economy simply won't permit an increase anytime soon.