Do You Need Property and Casualty Insurance?

There are so many things in the news these days, including natural disasters, mold, terrorism and other threats that may cause you to consider purchasing property and casualty insurance. But did you know that property and casualty insurance has become more costly and difficult to obtain these days? This is especially true of conventional and government-assisted housing and commercial markets.  

According to financial records, the property and casualty insurance industry posted a net loss of $7.9 billion in the year 2001. This is the first ever-recorded net loss for the property and casualty insurance industry. This is according to the Insurance Services Office, Inc. (ISO) and the National Association of Independent Insurers (NAII).  

What does this mean for you? This means that there are several property and casualty insurance companies that are in the process of retrenching. This means that many of these insurance companies and firms are actively avoiding adding new policies to their property and casualty insurance ranks.

Many of these insurance agencies have also ceased updating or renewing existing property and casualty insurance policies. It will probably not surprise you to hear that the premium price of property and casualty insurance policies has also been increased.  

What are the stated causes for the downturn in the property and casualty insurance industry? It used to be that "Mold is Gold" was the unspoken motto of the industry. However, the group of recent large court decisions against insurers has cut into their profitability margins. In one well-publicized Texas lawsuit, for instance, the property and casualty insurance company had to pay out after a $32.1 million decision.

Many believe that the events of September 11 also negatively impacted the property and casualty insurance industry. For instance, September 11-related property and casualty insurance claims were seen to total as high as $70 billion.  

What does this mean for you? The downturn of the Property and casualty insurance affects all of those who would like to invest and protect their real estate investments. The real estate market simply cannot function properly if investors do not have access to the property and casualty insurance industry.

It can even stop some people from being able to invest in real estate. This is because it is an underwriting requirement in many conventional, government-assisted and commercial mortgages that you apply and get property and casualty insurance. Most lending companies require property and casualty insurance from homeowners. If you are not able to get this insurance, your mortgage application may very well be rejected.