The year ahead is likely to be another profitable one for property-casualty insurance as a whole–but the big question is how long the party will last, given the industry's competitive drive and the ever-present threat of a mega-catastrophe, analysts at the annual Joint Industry Forum here agreed.
Even as one prominent investment house predicted a p-c industry 2006 return on equity of 15 percent–quite high by historic standards–analysts here were also worried whether pricing and bottom-line results would head south if competition heats up.
Despite record catastrophe losses, the industry posted solid gains last year and even a possible underwriting profit for only the second time in over 25 years, the analysts noted. However, concerns were voiced over how long pricing discipline would prevail, or whether it would take another Katrina-like event this year to keep the lid on temptations to price aggressively for revenue and marketshare growth at the expense of profitability.
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