AM Best reports that the U.S. property and casualty (P&C) industry recorded net underwriting earnings of $60.9 billion in 2025, a significant increase from the $22.1 billion in earnings the previous year.
These improved results were driven by a 6.1% increase in net premiums earned, lower incurred losses and loss adjustment expenses, and relatively quiet catastrophe losses in 2025, particularly in the second half, according to the global ratings agency’s First Look: U.S. Property/Casualty Insurance Financial Results 2025.
The report provides an initial look at the industry’s current financial position, using the 2025 statutory statements received on March 9, 2026.
AM Best explains that this figure represents an estimated 96% of the industry’s total net written premiums and 94% of policyholder surplus.
The report also showed that the industry’s combined ratio improved, falling to 92.9%. AM Best estimates that catastrophe losses will account for 7.6 percentage points of the combined ratio in 2025, down from the previous year’s estimate of 8.8 percentage points.
Excluding $18.1 billion of favorable reserve development during 2025, the industry’s annual combined accident rate was 94.9%.
Pre-tax operating income increased 43.2% to $153.1 billion in 2025, driven by underwriting success and investment income growth of 9.1%. However, despite strong operating results, the U.S. property and casualty insurance industry’s total net profit fell 9.5% year-on-year to $150.9 billion.
AM Best attributed the decline primarily to a 71.6% decline in realized net capital gains, which was primarily affected by a combined $60 billion decline across Berkshire Hathaway’s three companies.
Finally, AM Best reported that industry earnings increased 11.4% from the end of 2024 to $1.2 trillion, with changes in net income, unrealized gains and paid-in capital totaling $199.2 billion, reducing other earnings losses and shareholder dividends by $76.3 billion.
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