Hartwig adds that there now is “no question” that 2013 fourth-quarter performance for the property and casualty insurance industry “will be far superior” to 2012.

He explained that will happen because last year's fourth quarter includes the impacts of Hurricane Sandy, which resulted in $18.8 billion in insured catastrophe losses. “No event in the fourth quarter of 2013 comes remotely close,” Hartwig saus.

In addition, he says P&C insurers will benefit from a strong performance in financial markets during the final quarter of the year.

ISO and PCI say nine-month results for 2013 benefited from a $2.1 billion increase in net investment gains—the sum of net investment income and realized capital gains (or losses) on investments—to $40.4 billion compared to $38.3 billion in nine-months 2012.

Michael R. Murray, ISO's assistant vice president for financial analysis, says his analysis indicates that a number of factors were involved in the improved results. Besides “relatively benign weather,” special developments that helped improve the results included developments in the mortgage and financial guaranty insurance segments.

Murray and Hartwig say improvements in these sectors added to increases in overall reserves in the industry. Hartwig says these sectors had been “hit hard during the financial crisis but have now largely recovered.”

The improvement in underwriting and investment results was partially offset by a drop in miscellaneous other income and higher taxes, Murray says.

Insurers' pretax operating income—the sum of net gains or losses on underwriting, net investment income, and miscellaneous other income—grew to $45.7 billion in nine-months 2013 from $31.4 billion in nine-months 2012.

The increases in insurers' pretax operating income, net income after taxes, and overall rate of return were driven by a $16.7 billion swing to $10.5 billion in net gains on underwriting in nine-months 2013 from $6.2 billion in net losses on underwriting in nine-months 2012.

The combined ratio improved to 95.8 for nine-months 2013 from 100.7 for nine-months 2012, Murray says.

Hartwig says persistently low interest rates “remain a challenge for the industry,” but he notes overall industry capacity rose to a record $624.4 billion as of September 30, 2013—up $45.1 billion, or 7.8 percent, from $579.3 billion as of year-end 2012.