Friday, May 25, 2012

ANNUAL CASH FLOW – 2004 to 2011 – U.S. P & C Insurers

The two graphics below present the annual cash flow for the last 8 years for the U.S. P & C industry.  The first graphic sets out the detail of cash flow from operations, investments and financing.  The second graphic sets out the net cash flow which has been negative for 4 of the last 8 years and is clearly a deteriorating picture.  

The detail presented in the first graphic shows that the decrease in cash flow from investments in 2011 was largely offset by a somewhat improved cash flow from financing activities.  The result is that the overall negative cash flow suffered by the industry in 2011 came almost entirely from operations.  This a key factor that is moving the industry towards an ever tightening market.

- Jerry Sullivan

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