Gauging Risk in the P&C Sector

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.