|
Chennai:
Regardless
of the 9 / 11 disaster and other claims, the rate at which the US insurers
have been going bust has slowed down to a large extent in the past five years.
It should be noted that US is known for insurance companies going bust.
According to a report titled US Insurer Failures Fall To Lowest Level Since
1996, by Standard & Poor's Ratings Services (S&P), the annual
number of US insurer failures has been steadily declining since 2000. This
suggests an increasingly favorable environment for insurers in general. However,
the extent and consistency of improvement in 2004 was better than expected. According
to S&P, 19 insurance companies were put under regulatory supervision in
2004 compared with 28 in 2003 and 39 in 2002. The
number of property and casualty failures fell to 13 in 2004 compared with
20 in 2003 and 28 in 2002. Property and casualty failures, which historically
have made up the bulk of the total count, constituted 68 per cent of total
failures in 2004 compared with a 10-year average of 60 per cent. The
number of life failures decreased to three in 2004 compared with five in 2003
and three in 2002. The number of health failures stayed at three in 2004 compared
with three in 2003 and eight in 2002. Of
the 19 failed insurers, 17 were not rated by S&P at the time of failure.
The remaining two were rated below the secure level ('BBB'), and only one
was interactively rated. In 2004, the gap between
US insurance company downgrades and upgrades closed significantly relative
to 2002-to 90 downgrades versus 60 upgrades for interactively rated companies.
|
