U.S. Property/casualty insurers’ operating earnings decreased in 2015, highlighting the competitive operating environment and low investment yields that challenge insurers’ earnings growth potential, according to a new report by Fitch Ratings. Favorable reserve development and limited catastrophic loss activity helped to offset sluggish investment income.
Fitch’s universe of 45 (re)insurance organization reported an aggregate a 7.2 percent decline in operating earnings to $47.3 billion in 2015. This result corresponds with a group operating return on average equity (ROAE) of 7.6 percent, down from the 8.4 percent return generated in the previous year. An operating ROAE of 10 percent or higher
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