Weiss Ratings


Property and Casualty Insurers' Profits Double
In First Nine Months of 2003
Industry's Underwriting Loss Improves 76%

JUPITER, Fla., March 8, 2004 — Property and casualty insurers earned $22.9 billion during the first nine months of 2003, representing a $12.1 billion, or 112 percent, increase over the $10.8 billion profit reported during the same period in 2002, according to Weiss Ratings, Inc., the nation's leading independent provider of ratings and analyses of financial services companies, mutual funds, and stocks.

Property and casualty insurers reporting the largest year-over-year increases in net income include:

Company Headquarters

Weiss Safety Rating

Net Income (Loss) ($Mil)

3rd Qtr
2003

3rd Qtr
2002

$
Change

American Re-Insurance Co. Princeton, N.J.

C-

478.6

(1,617.0)

2,095.6
State Farm Mutual Automobile Ins. Co. Bloomington, Ill.

B+

738.8

(771.3)

1,510.1
AllState Ins. Co. Northbrook, Ill.

A-

1,807.3

953.7

853.6
Columbia Ins. Co. Omaha, Neb.

B-

567.6

(266.1)

833.7

Firemans Fund Ins. Co.

Novato, Calif.

C-

45.5

(774.0)

819.5

Weiss Safety Rating: A=Excellent; B=Good; C=Fair; D=Weak; E=Very Weak

"Property and casualty insurers flourished due to higher premiums and increased investment gains over the past year," commented Melissa Gannon, vice president of Weiss Ratings, Inc. "However, with policyholders beginning to see better renewal rates, the tide may be changing, and the true strength of the industry will be determined by its underwriting capabilities."

Underwriting Loss Improves by 76%

The impressive performance of property and casualty insurers was driven by a 76.5 percent improvement in underwriting results. By adhering to stricter underwriting standards and increasing premiums, the industry dramatically reduced its underwriting loss to $4 billion in the third quarter of 2003, compared to a $17.1 billion loss during the same period in 2002.

Insurers reporting the largest improvement in underwriting performance include:

Company

Headquarters

Weiss Safety Rating

Underwriting Gain (Loss) ($Mil)

3rd Qtr

2003

3rd Qtr

2002

$

Change

State Farm Mutual Automobile Ins. Co.

Bloomington, Ill.

B+

(823.5)

(3,305.5)

2,481.9

American Re-Insurance Co.

Princeton, N.J.

C-

27.5

(1,947.2)

1,974.8

Firemans Fund Ins. Co.

Novato, Calif.

C-

(67.5)

(854.7)

787.2

Columbia Ins. Co.

Omaha, Neb.

B-

378.3

(391.0)

769.3

Zurich American Ins. Co.

New York, N.Y.

B-

84.1

(680.8)

764.9

Weiss Safety Rating: A=Excellent; B=Good; C=Fair; D=Weak; E=Very Weak

Notable Upgrades and Downgrades

Among the 2,212 property and casualty insurers reviewed by Weiss, four companies were upgraded, while 19 were downgraded. Notable upgrades include:

Notable downgrades include:

The Weiss Safety Ratings are based on an analysis of a company's risk-adjusted capital, reserve adequacy, profitability, liquidity, and stability. The latter category combines a series of factors including asset growth, premium growth, strength of affiliate companies, and risk diversification.

Weiss issues safety ratings on more than 15,000 financial institutions, including insurance companies, banks, and brokerage firms. Weiss also rates the risk-adjusted performance of more than 12,000 mutual funds and more than 8,000 stocks. Weiss Ratings is the only major rating agency that receives no direct or indirect compensation from the companies it rates for issuing its ratings. Revenues are derived strictly from sales of its products to consumers, institutions, businesses, libraries, and governmental agencies.

Consumers needing more information on the financial safety of a specific company can purchase a rating and summary analysis for as little as $14.99 through www.WeissRatings.com, or starting at $19 by calling 800-289-9222.

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Note to Editors: National and state listings of strongest and weakest property and casualty insurers are available here.


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