GENERAL

INSURANCE IN
USA
B Y : A N S H AG G A RWA L ( 0 2 )
A R P I TA D A S G U P TA ( 1 2 )
KANISHK JAMKAR(22)
NAMITESH MISHRA(32)
M A N O J R A W AT ( 4 2 )
SANJANA SHARMA(52)
 INTRODUCTION
USA,the world's largest insurance market by premium volume.Of the $4.640 trillion of gross
premiums written worldwide in 2013, $1.274 trillion (27%) were written in the United States.
The larger insurance companies by market capitalization include AIG, MetLife, Prudential
Financial , and Allstate .
While MetLife and Prudential Financial top the chart of life and health insurers in terms of
premiums written, State Farm, Liberty Mutual, and Allstate are among the top players in the
property and casualty space in the United States.
 HISTORY
The first insurance company in the United States underwrote fire insurance and was formed
in Charleston, South Carolina, in 1735.
In 1752, Benjamin Franklin helped form a mutual insurance company called the Philadelphia
Contributionship, which is the nation's oldest insurance carrier still in operation.
Franklin's company was the first to make contributions toward fire prevention. Not only did
his company warn against certain fire hazards, it refused to insure certain buildings where the
risk of fire was too great, such as all wooden houses.
Formal regulation of the insurance industry began in earnest when the first state commissioner
of insurance was appointed in New Hampshire in 1851.
In 1859, the State of New York appointed its own commissioner of insurance and created a
state insurance department to move towards more comprehensive regulation of insurance at
the state level.
 Insurance and the insurance industry has grown, diversified and developed significantly ever
since.
Insurance companies were, in large part, prohibited from writing more than one line of
insurance until laws began to permit multi-line charters in the 1950s.
From an industry dominated by small, local, single-line mutual companies and member societies,
the business of insurance has grown increasingly towards multi-line, multi-state and even multi-
national insurance conglomerates and holding companies
CURRENT
SCENARIO

P R O P E R T Y / C A S U A LT Y
P/C INSURANCE, US

The U.S. insurance industrys net premiums written totaled $1.2 trillion in 2015, with premiums
recorded by life/health (L/H) insurers accounting for 55 percent and premiums by property/casualty
(P/C) insurers accounting for 45 percent, according to S&P Global Market Intelligence.
P/C insurance consists primarily of auto, home and commercial insurance. Net premiums written
for the sector totaled $519.8 billion in 2015.
There were 5,926 insurance companies in 2015 in the United States (including territories), including
P/C (2,544), life/annuities (872), health (859), fraternal (85), title (56), risk retention groups (239) and
other companies (1,261), according to the National Association of Insurance Commissioners.
The U.S. insurance industry employed 2.6 million people in 2016, according to the U.S. Department
of Labor.
PROPERTY/CASUALTY AND LIFE/HEALTH
INSURANCE PREMIUMS, 2015 (1)
Total P/C cash and invested assets were $1.5 trillion in 2015, according
to S&P Global Market Intelligence.
P/C insurers paid out $15.2 billion in property losses related to
catastrophes in 2015, compared with $15.5 billion in 2014 according to
the Property Claims Services division of Verisk Analytics. There were 39
catastrophes in 2015, compared with 31 in 2014.
TOP 3 GENERAL INSURANCE COMPANIES:
1. State Farm
Direct Premiums Written: $59.361 billion
Market Share: 10.09%
Identity Restoration, Sport & Leisure Vehicles, Triangle of protection
2. Allstate
Direct Premiums Written: $30.18 billion
Market Share: 5.13%C
Condo, Roadside, Drivewise

3. Berkshire Hathaway Homestate Company

Direct Premiums Written: $29.967 billion
Market Share: 5.09%
Real Estate Owned & Forced Placed
 Insurance Regulation
Historically, the insurance industry in the United States was
regulated almost exclusively by the individual state governments.

Under the state-based insurance regulation system, each state

operates independently to regulate their own insurance markets,
typically through a state department of insurance or division of
insurance
The insurance act of 1938 was the
first legislation governing all forms of
insurance to provide strict control
over insurance business.
Purpose: To safe guard the interest of insured ,setting the norms for
carrying out the business of insurance smoothly, minimizing disputes.
NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONERS (NAIC)

The National Association of Insurance Commissioners (NAIC) is the U.S.

standard-setting and regulatory support organization created and governed by
the chief insurance regulators from the 50 states, the District of Columbia and
five U.S. territories.

It adopted several model reforms for state insurance regulation, including risk-
based capital requirements, financial regulation accreditation standards and an
initiative to codify accounting principles.
MISSION OF NAIC

Protect the public interest;

Promote competitive markets;
Facilitate the fair and equitable treatment of insurance consumers;
Promote the reliability, solvency and financial solidity of insurance institutions; and
Support and improve state regulation of insurance.
 Issues and Challenges faced in US Insurance
Business

Some of the important issues are:

Creating an effective strategy, including taking advantage of the opportunities
arising from InsurTech and artificial intelligence, and ensuring that business
models are fit for growth.
Market segment challenges and opportunities, including in cyber-
insurance, commercial lines, and group.
Managing risk and regulatory complexity.
Process and systems improvement, including addressing the challenges of the aging
industry workforce and how the life and annuity market can use BPO to improve
operational efficiency.
Tax
The importance of recruiting new talent to the industry
Regulatory changes, including how the fiduciary rule that is being cooked up by the
Department of Labour (DOL) will raise the barrier to entry
How to put insurance into more Americans hands
The importance of repopulating sales forces.
INSIGHTS FOR
FUTURE AND
CONCLUSION
 The Republican government which leads the country in both the house will
surely promote corporate friendly regime and thus less regulatory pressure
are expected.
Cyber security is a growing concern and has caused tremendous loss to
several institutions and the whole sector has come under scrutiny.
More focus on customer driven innovation
THANK YOU