Fourth quarter 2013 underwriting gain was $128 million, a substantial improvement compared with a loss of $229 million in fourth quarter 2012, as a result of improved current accident year results and lower catastrophe losses. Catastrophe losses totaled $28 million, before tax, in fourth quarter 2013, a substantial decline from fourth quarter 2012 catastrophe losses of $335 million, before tax, which included significant losses from Storm Sandy. PYD had a relatively modest impact on underwriting results in both periods, totaling an unfavorable $15 million, before tax, in fourth quarter 2013 compared with an unfavorable $9 million, before tax, in fourth quarter 2012.

Fourth quarter 2013 combined ratio was 94.9 compared with 109.2 in fourth quarter 2012. Before catastrophes and PYD, the P&C (Combined) fourth quarter 2013 combined ratio improved 2.2 points to 93.2 compared with 95.4 in fourth quarter 2012, reflecting pricing and underwriting initiatives in P&C Commercial.

Fourth quarter 2013 written premiums increased 2% over the prior year period, reflecting 1% growth in P&C Commercial and 3% growth in Consumer Markets.

P&C CommercialFourth Quarter 2013 Highlights:
  • Underwriting gain improved to $98 million compared with a loss of $193 million in fourth quarter 2012 due to lower catastrophe losses and better current accident year results
  • Standard Commercial renewal written pricing increased 8% in fourth quarter 2013, consistent with the last five quarters
  • Middle Market workers' compensation represented 30% of new business, compared with 38% in fourth quarter 2011
P&C COMMERCIAL              
($ in millions)       Three Months Ended
        Dec. 31 2013     Dec. 31 2012     Change
Underwriting gain (loss)       $98     $(193)     NM
Combined ratio       93.7     112.3     18.6
Combined ratio before catastrophes and PYD       92.5     97.8     5.3
Small Commercial       85.9     92.8     6.9
Middle Market       94.8     99.0     4.2
Specialty       100.6     111.2     10.6
Written premiums       $1,463     $1,454     1%
Standard commercial price increases       8%     8%    
 

P&C Commercial underwriting gain was $98 million in fourth quarter 2013 versus a loss of $193 million in fourth quarter 2012 due to lower catastrophe losses and better current accident year results in each of its three businesses (Small Commercial, Middle Market and Specialty.) Fourth quarter 2013 catastrophe losses totaled $7 million, before tax, compared with $209 million, before tax, in fourth quarter 2012, due to Storm Sandy.

If you liked this article you might like

Buffett's Berkshire, Rivals Brace for Billions in Hurricane Harvey Claims

Cramer: Let's Handicap Hurricane Harvey's Best Stock Bets

Mid-afternoon Musings; Amazon Shorting: Doug Kass' Views

Truth Is, Intrinsic Value, not Price, Is Truth in Investing

Takeaways and Observations; Church of What Is Working Now: Doug Kass' Views