Us P&c Insurers Post $31.7 Billion Underwriting Gain In First Half Of 2026

The U.S. property & casualty insurance industry posted an estimated net underwriting gain of $31.7 billion in the first half of 2026, up from $11.6 billion during the same period in 2025, when results were heavily affected by catastrophe losses from the Los Angeles wildfires, according to a report from Verisk and the American Property Casualty Insurance Association (APCIA).

The improvement came even as net written premium growth slowed to 2.1%, reflecting more competitive market conditions and moderating rate increases, the organizations found. Policyholders’ surplus grew to $1.3 trillion in the first half of 2026, up from $1.13 trillion at midyear 2025, strengthening insurers’ capacity to absorb future catastrophe losses, according to the report.

Premium Growth Slows As Market Softens

Net written premium growth fell to 2.1% in the first half of 2026, compared with 5.2% during the same period in 2025 and a recent peak of 10.8% in the first half of 2024, according to the report. Net earned premiums rose 3.3%, down from 7.3% growth in the first half of 2025.

Robert Gordon, senior vice president of policy, research and international at APCIA, said premium increases “continued to moderate in the first half of 2026, falling below general inflation and building materials and labor costs.”

Property lines softened broadly, while casualty lines remained under pressure despite early signs that the hard casualty market is beginning to cool, the report said.

Saurabh Khemka, president of Verisk Underwriting Solutions, said the results should not be read as a sign that underlying risk has eased. “Broader industry performance highlights the growing value of precision as property market conditions continue to soften,” Khemka said, adding that increased market segmentation means insurers may benefit from a deeper understanding of exposures, claims behavior and portfolio performance as pricing grows more competitive.

Affordability remains a challenge for property owners and businesses, as rising construction costs and claim severity continue to affect rebuilding costs and loss recovery, according to the report.

Combined Ratio Improves, Catastrophe Exposure Persists

Incurred losses and loss adjustment expenses fell 4.8% in the first half of 2026, compared with a 5.1% increase during the same period in 2025, the report said. The industry’s combined ratio improved to 92.7, compared with 96.5 at midyear 2025, which the organizations described as one of the strongest half-year underwriting performances in recent history.

Even so, Khemka said catastrophe exposure remains a central risk for the industry. Verisk’s 2026 Global Modeled Catastrophe Losses Report found the industry faces approximately $171 billion in average annual insured catastrophe losses globally, with the U.S. accounting for about $117 billion, or roughly two-thirds of the global total. Khemka said those figures “underscore the potential scale of exposure in the U.S. and demonstrate that frequency perils such as severe convective storms and wildfires can produce significant losses and uneven underwriting results from the industry.”

Casualty Losses Worsen As Legal System Reforms Show Impact

Net investment gains rose to $59.6 billion in the first half of 2026, compared with $49.0 billion during the same period in 2025, contributing to a 53% increase in net income after taxes, which reached $77.8 billion compared with $50.9 billion in the first half of 2025, the report said.

APCIA’s Gordon said loss experience and profitability varied widely by state. In states that have enacted what APCIA characterized as meaningful legal system abuse reforms, including Florida, Georgia and Louisiana, many policyholders have begun seeing reductions in auto and homeowners insurance rates that are expected to provide hundreds of millions of dollars in premium relief, he said.

At the same time, Gordon said bodily injury and commercial liability losses continued to worsen even as natural catastrophe losses eased. “Excess liability, umbrella liability, commercial auto, and other casualty lines experienced ongoing pressure from escalating claim severity, nuclear verdicts, and rising medical costs,” Gordon said.

Read more about the report here. & 

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