A.M. Best & Co. Inc. said on Friday that it has revised its outlook for the US commercial insurance segment from negative to stable, citing favorable decisions on covid-19 insurers' business interruptions among other factors.
Coviden's relatively modest negative impact. -19 pandemic on commercial insurance companies' financial results in 2020 and even the third quarter of 2021 was an important driving force for the change in the outlook, said Best.
the line where this pattern is most obvious, "Best noted in his report.
Disputes related to denial of coverage for business interruptions have generally been resolved in favor of insurance companies, with many cases dismissed but proceeding to trial, Best said.
The segment delivered better issuance results in 2020 than in 201
In the light of greater clarity on the effects of P andemic, the Oldwick, New Jersey-based credit rating agency also revised its market segment outlook to stable for several key commercial activities, including employment compensation , commercial property and surety.
Continued p strong pricing rate over commercial lines, except for workers. compensation, was another contributing factor to the change in outlook, said Best.
Best expects interest rates to continue to rise, but the growth rate is likely to slow to 2022. " increase growth will slow somewhat, but remain strong until 2022 ", the report says.
While higher inflation may continue to push up prices for goods and materials, the segment will have capital to cope with any temporary price increases as a profit, said Best.
It expects the segment to remain profitable despite near and long-term challenges.