P&C – Analysis of Direct Underwriting Profit by Line by Company / Future Implications (CB, HIG, KNSL, RLI, TRV, WRB)

Research evidence excerpt

P&C – Analysis of Direct Underwriting Profit by Line by Company / Future Implications (CB, HIG, KNSL, RLI, TRV, WRB)

egories – fire &

allied, commercial multi-peril (property), and inland marine – where reinsurance tends

to have a material impact on premium volumes and net losses (we address this dynamic

in our company discussions). For expense ratios and loss adjustment expenses, which

are not provided by line in the quarterly stat data, we assume numbers equal to the

full-year 2025 result.

Summary

This quarter again highlighted the sharp divide between property, which generated

a better direct combined ratio industry-wide compared to both 1Q and full-year 2025,

and casualty, which deteriorated for the sector as a whole and for most public carriers

in most individual lines.

Workers’ compensation was still highly profitable, but a relative drag on year-

over-year earnings for most carriers, including CB and TRV. This line probably remains

a constraint on earnings growth as premium accelerated to the downside in 1Q, while

NCCI reported a decline in reserve redundancy.

There is limited visibility for improvement in liability lines, which generated mid-

single-digit premium growth in aggregate in 1Q, down a point from 4Q, while the

latest indications from the E&S and IVANS data are cautious around second quarter

prospects.

Property has actually followed a relatively sedate trajectory so far as topline growth

– here including fire & allied and commercial multi-peril (property) – has remained

positive (national accounts and coastal risks appear to be noteworthy exceptions but

they have not yet sunk overall premium).

Chubb (CB, Not Rated) domestic commercial P&C earnings are still heavily tied

to property and workers’ comp, both lines where the company’s direct underwriting