US property and casualty (P&C) insurers have posted strong underwriting gains of $31.7 billion through the first half of 2026, up from the $11.6 billion recorded through midyear 2025, according to Verisk and the American Property Casualty Insurance Association (APCIA) data, yet line-specific and geographic challenges persist.
Net written premium growth slowed to 2.1%, reflecting competitive market conditions as rate increases moderated. Policyholders’ surplus increased to $1.3 trillion, strengthening insurers’ ability to absorb future catastrophe losses and support long-term market stability.
Half-year profitability was also supported by higher investment income; however, catastrophe exposure remains elevated and continues to pose significant long-term risk.
While property lines experienced softening, casualty lines continued to face pressure, even as indicators suggest the hard casualty market is starting to cool.
Concurrently, escalating construction expenses and claim severity persist in driving rebuilding costs and post-loss recovery, keeping affordability a key concern for commercial entities and property owners.
Saurabh Khemka, president of Verisk Underwriting Solutions, stated: “First-half results should not be mistaken as evidence that underlying risk has diminished. Broader industry performance highlights the growing value of precision as property market conditions continue to soften.
“Increased market segmentation means insurers may benefit from a deeper understanding of exposures, claims behaviour and portfolio performance to help support profitable growth as pricing becomes more competitive.”
For insurers, this environment reinforces the need to evaluate risk at a more granular level and closely monitor changes in exposure, claim severity and portfolio mix.
Khemka continued: “The value of precision is particularly important given the scale of natural catastrophe exposure facing the industry. Verisk’s 2026 Global Modeled Catastrophe Losses Report* indicates that the industry faces approximately $171 billion in average annual insured catastrophe losses globally, with the US accounting for about $117 billion, or approximately two-thirds of the global total.
“Those figures underscore the potential scale of exposure in the U.S. and demonstrate that frequency perils such as severe convective storms and wildfires can produce significant losses and uneven underwriting results from the industry.”
In the first half of 2026, the US P&C insurance industry’s strong performance was driven by an improved combined ratio of 92.7 and a 4.8% drop in incurred losses.
Net underwriting gains nearly tripled to $31.7 billion, while premium growth moderated, with net written premiums rising 2.1% and net earned premiums up 3.3%.
Buoyed by $59.6 billion in net investment gains, after-tax net income jumped 53% to $77.8 billion, lifting policyholders’ surplus to $1.30 trillion.
Robert Gordon, senior vice president of policy, research and international at APCIA, said: “In good news for policyholders, premium increases continued to moderate in the first half of 2026, falling below general inflation and building materials and labour costs. Net written premium growth slowed to 2.1 percent in H1 2026, from 5.2 percent in H1 2025 and a recent peak of 10.8 percent in H1 2024.
“While overall industry profitability improved in the first half of 2026, largely due to a decline in insured natural-catastrophe losses compared to the first half of 2025 following the Los Angeles wildfires, insurers’ loss experience and profitability varied widely from state to state. In states that have enacted meaningful legal system abuse reforms, including Florida, Georgia and Louisiana, many policyholders have begun to experience reductions in auto and homeowners’ insurance rates that are expected to provide hundreds of millions of dollars in premium relief.”
He concluded: “While insured natural-catastrophe losses provided a temporary reprieve in the first half of 2026, bodily injury and commercial liability losses continued to worsen. Excess liability, umbrella liability, commercial auto, and other casualty lines experienced ongoing pressure from escalating claim severity, nuclear verdicts, and rising medical costs.”
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