Following a review of industry aggregate statutory financials for year-end 2007 and first-quarter 2008, Fitch Ratings has updated its full-year 2008 U.S. property/casualty industry forecast and is projecting a modest underwriting loss and significant reduction in profits and return on surplus for the year.

In a new report released June 11, Fitch Ratings reviewed key drivers influencing industry results for 2007 and going forward. While the property/casualty market has experienced favorable results in 2007 and over the last five years, Fitch believes this success has led to the development of excess capital in the market, which has fostered intense price competition that will lead to deteriorating profits in 2008 and at least through 2009.

Highlights of Fitch's industry forecast for 2008 include:

• Flat written premium growth similar to 2007
• A combined ratio of 100.4 percent compared with 95.6 percent in 2007
• Return on surplus of 7.6 percent versus 12.3 percent in 2007

To access this Special Report, “Property/Casualty Industry Statutory Results and Forecast: Shift to Modest Underwriting Loss In 2008” please visit 'www.fitchratings.com' under Financial Institutions > Insurance > Special Reports.

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Source: Fitch Ratings

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