$20B in redundant reserves
Assured Research says the U.S. property/casualty industry closed 2025 with more than $20 billion in redundant loss reserves — reserves that exceed expected ultimate losses and could mask underwriting stress. That cushion helps absorb catastrophe volatility but also invites investor and regulator scrutiny on claims accuracy and reserve adequacy. (insurancejournal.com)
Assured Research’s line-level exhibits show private passenger auto liability carries a $12.0 billion reserve excess while other liability (occurrence) shows a $12.5 billion shortfall. (taguealliance.com (taguealliance.com)) (taguealliance.com) Private passenger auto redundancy jumped from roughly $1.9 billion at year-end 2024 to the $12.0 billion estimate in the firm’s 2025 analysis, a shift William Wilt described as signaling an “outright soft market” for personal auto. (carriermanagement.com (carriermanagement.com)) (carriermanagement.com) Other liability (occurrence) remains the largest per-line deficiency at $12.5 billion, but Assured Research’s exhibits show that deficiency narrowed from the prior analysis and included about $7.3 billion of adverse development during 2025. (taguealliance.com (taguealliance.com)) (taguealliance.com) AM Best’s preliminary industry tallies for 2025 recorded a $60.9 billion net underwriting gain and an improved combined ratio of 92.2, metrics cited alongside Assured Research’s reserving analysis in multiple trade write-ups. (ambest.com via BusinessWire/Morningstar (morningstar.com)) (morningstar.com) Assured Research, founded in November 2011, says its subscriber base places or writes over $700 billion of annual premiums, and its report notes William Wilt — the firm’s president and a Fellow of the Casualty Actuarial Society — as the author of the reserve analysis. (assuredresearch.com (assuredresearch.com)) (assuredresearch.com) Assured Research and industry commentators link persistent liability reserve strain to social inflation dynamics documented by Swiss Re’s 2025 Behavioral Social Inflation Study and to a surge in large jury awards—Marathon Strategies counted 135 “nuclear verdicts” in 2024 totaling about $31.3 billion. (swissre.com (swissre.com)) (swissre.com) (marathonstrategies.com (marathonstrategies.com)) (marathonstrategies.com)
