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Missouri P&C carriers report profitable 1997

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All of Missouri's major lines of property and casualty insurance were profitable in 1997, led by medical malpractice and workers' compensation insurance, according to a release from the Missouri Department of Insurance.

Average property and casualty insurance profits equaled 17 cents of each dollar in premium earned for insurers operating in Missouri, based on companies' reports to a multi-state regulatory body.

Those profit levels reached up to 43 cents of the premium dollar for medical malpractice insurance and 26 cents for workers' compensation coverage.

"These figures reinforce our belief that a financially robust and stable insurance industry can exist in harmony with strong consumer protection efforts," said A.W. McPherson, the department's acting director.

Insurance companies report their operating data to the National Association of Insurance Commissioners. The group late last month made available 1997 state-by-state allocations that allow calculation of Missouri-only financial performance for the industry.

In Missouri, insurers in 1997 paid or incurred benefits that averaged 58 cents of each premium dollar earned. No line of insurance paid out or incurred future benefit payments of more than 75 cents of each dollar.

The 17 percent profit figure in 1997 for all lines compared to almost 14 percent for Missouri in 1996; Missouri also exceeded the 15 percent national average in 1997. Missouri traditionally has been more profitable for insurance carriers than the country as a whole, the department release said.

Rebounding financially in 1997 was industry performance in homeowners insurance, which went from a 2.5 percent loss in Missouri in 1996 to a 14.4 percent profit. Likewise, farmowners insurance posted a 12.6 percent profit, compared to losses of 3.5 percent the previous year.

The largest improvement occurred in medical malpractice insurance. It had a loss of 2.7 percent of premium in 1996 an atypically poor year because of a few companies' reserving increases but companies reported a 42.6 percent profit in 1997.

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