Demotech, Inc. recently conducted a study to determine if one particular segment of the P&C industry displays a voracious appetite for risk when compared to other sectors. The Columbus, OH-based financial analysis and actuarial services firm analyzed more than 2,900 individual, active P&C insurers to reach a conclusion.

Its analysis, titled "Reviewing Property and Casualty Industry Management Practices – the Financial Perspective," primarily focused on asset management practices, loss reserving practices, and capital adequacy based on data emanating from current regulatory practices. Essentially, Demotech says it wanted to ascertain if certain classes of P&C companies displayed more aggressive investment practices and assumed greater financial risks based on market size or ownership structure.

For the purpose of the study, Demotech divided companies into five primary categories: pure mutual, mutual, stock (public), stock (private), and other. Each of the designated company types were then further segmented into classification: national, near national, super regional, regional, coverage specialist, state specialist, direct premiums written of less than $1 million, reinsurer, risk retention group, strategic subsidiary, and surplus lines carrier.