MANAGE & LEAD
A LOOK AT THE KANSAS INSURANCE
MARKETPLACE
By: Dave Hulcher
AM Best’s marketplace data is out for 2019, so we wanted to provide you with a review of the Kansas marketplace. Our
goal in sharing this marketplace information is to provide agencies with an overview of the aggregate data and global
perspective that will aid in guiding discussions with customers about past, current, and future industry trends that could
impact their risk management approach. This year, we’ve included information on the total personal and commercial lines
groups and the total Kansas marketplace, which is $6.9B in written premiums.
Should you have any questions about this review or are interested in additional information on specific insurance
companies, please don’t hesitate to reach out to any member of KAIA’s staff.
PRIVATE PASSENGER AUTO
In 2019 the overall premium for personal auto grew to
$2.003B, an increase of 2.75% from 2018. This is slower
growth in premiums than seen in 2016-2018. After two
years of decreased direct combined loss ratios, 2019
increased several percentage points to 88.84%.
HOMEOWNERS
After experiencing a 69.86% direct combined loss ratio
in 2018, the homeowners’ marketplace experienced an
almost 25% increase in 2019, skyrocketing to 94.82%.
Meanwhile, premiums were up 4.31% for that same time.
PRIVATE PASSENGER AUTO 2016-2019 HOMEOWNERS 2016-2019
The definition of direct combined loss ratio is the losses paid and reserved on claims plus loss adjusting expenses and insurer average expenses (like
commissions and premium taxes) and all before any benefit of losses reinsured divided by earned premiums (see below formula). As a reminder, for
combined ratios above 100 the insurer is losing money on each premium dollar if investment income is not making up the difference.
Formula for Direct Combined Ratio = (losses paid+loss reserved+loss adjusting expenses+general insurance expenses) /Earned Premiums.
14