Professionals Verify the Integrity of Reported Operating Results

Columbus, Ohio, August 15, 2012:  At year-end 2011, 2,763 property and casualty insurance companies domiciled in the United States submitted their annual statements to the National Association of Insurance Commissioners.  Demotech’s review of the data indicated that the balance sheets of these insurers reported $601 billion of net loss and loss adjustment expense reserves and the year-end financial statements reflected $442 billion of net premium written.  At first blush it might seem reasonable to assume that this diversified group of 2,763 carriers writing nearly one-half trillion dollars of net written premium would have an extensive list of actuaries and auditors engaged to review their results, yet the number of professional firms engaged by the property/casualty insurance industry is quite concentrated.

In the somewhat uncertain economic environment in which US based insurers operate, it should be comforting to policyholders, producers, regulators, shareholders and interested parties that the property/casualty insurance industry must withstand regulatory scrutiny, independent audits, and reviews of reported loss and loss adjustment expense reserves prepared by credentialed actuaries.  Few industries have the balance sheet integrity of the property/casualty industry, with fewer still having that integrity affirmed by a variety of professionals.

The full report can be viewed by clicking here.

About Demotech, Inc.

Demotech, Inc. is a financial analysis firm specializing in evaluating the financial stability of regional and specialty insurers.  Since 1985, Demotech has served the insurance industry by assigning accurate, reliable and proven Financial Stability Ratings® (FSRs) for Property & Casualty insurers and Title underwriters.  FSRs are a leading indicator of financial stability, providing an objective baseline of the future solvency of an insurer.  Demotech’s philosophy is to review and evaluate insurers based on their area of focus and execution of their business model rather than solely on financial size.  This philosophy was the catalyst for the Demotech Company Classification System, which was published in Insurance Journal, in order to stratify and categorize insurers into operational categories.  Visit for more information.