P&C Companies Posted $6.4 Billion of Income in First Quarter

Fine, Jacob
June 2003
Bond Buyer;6/25/2003, Vol. 344 Issue 31664, p6
Trade Publication
Property and casualty insurance company profitability increased during the first quarter, as net income after taxes rose 20.6% over the first three months of 2002 to $6.4 billion. The first quarter results were driven by improved underwriting results and an increase in net investment gains, according to the data, which was compiled by Insurance Services Office Inc. and the National Association of Independent Insurers. The rise in income was accompanied by a $3.88 billion first-quarter increase in the municipal bond holdings of non-life insurance companies tracked by the Federal Reserve Board, a category that is mostly comprised of property and casualty insurers. As the insurers' income levels rise, their need for taxable investment income necessary to exempt them from the corporate alternative minimum tax decreases, increasing their capacity to own municipal bonds and benefit from their tax-exempt status.


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