According to a report from the credit rating agency AM Best, the US property and casualty (P&C) industry posted a net underwriting gain of $35 billion for the first nine months of 2025, a substantial increase from the $3.7 billion gain recorded in the same period of 2024.
AM Best reported that the third quarter of 2025 saw relatively low catastrophe losses, which supported a 7% increase in net premiums earned, while incurred losses and loss adjustment expenses remained close to levels seen in the previous year.
The industry’s combined ratio improved by four percentage points to 94.0, with catastrophe losses estimated at 8.0 percentage points, down from 8.7 percentage points during the first nine months of 2024.
A 5.9% increase in net investment income further strengthened underwriting performance, lifting pretax operating income by 52% to $102.4 billion. AM Best reported that an 80% drop in net realized capital gains, primarily driven by a $60.5 billion combined decline at three Berkshire Hathaway companies, resulted in net income falling 23% to $100.9 billion.
Policyholder surplus increased 6.8% from year-end 2024, reaching $1.2 trillion. This rise was driven by $131.3 billion in net income, unrealized gains, and contributed capital, with $20.5 billion in other surplus reductions and stockholder dividends reducing the net gain.
AM Best emphasised that its First Look report offers an early view of the financial condition of the US P&C industry. The data included in the report cover companies representing an estimated 98% of total industry net premiums written and 98% of policyholder surplus.
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