美国非寿险：财险与再保险市场状况改善

1、Equity Research15 April 2019u.s. Insurance/Non-LifeTheLongView:P&CMarketConditionsImprovingThisisdesignedcontext,analysisandinsight onkeyoftheindustryand theWeadeep-diveonindustry and in The sections summaryanalysisofmajorissuestheP&Cwe includingandFocusU.S. Insurance/Non-Life Jay Gelb, CFA+1 212 52

2、6 1561 HYPERLINK mailto:jay.gelb BcI,ussueLee+1 212 526 8190 HYPERLINK mailto:sue.lee sue.lee BcI, usAndrew Karp+1 212 526 9015 HYPERLINK mailto:andrew.karp andrew.karp BcI, usBarclays capital Inc. and/or one of its ailiates does and seeks to do business with companies coveredinitsresearchreports.As

3、aresult,investorsshouldbeawarethatthefirmmayhavea conflictofinterestthatcouldaecttheobjectivityofthisreport.Investorsshouldconsiderreportasonlyasinglefactorinmakingtheirinvestmentdecision.Please see analyst certifications and important disclosures beginning on page 183.TheLongView:P&CRe/InsuranceMar

4、ketConditions ImprovingProperty-Casualty Insurance Industry Conditions Improving. Following the worst two- yearperiodofinsuredcatastrophelossesonrecord,commercialP&Cre/insuranceprices arerising,andweexpectthistrendtopersist.Thisfactor,alongwithasustainedeconomic recoveryandstabilizingcoreunderwritin

5、gmarginsandmodestlyrisinginvestmentincome shouldimprovenormalizedearningspowerformostP&Cre/insurers.Although there is still plenty of excess capital, we expect sustained positive pricing momentumincommercialP&Candreinsuranceresultingfromoutsizedcatastrophelosses andthegrowingconsensusthatthissituati

6、oncouldbethenewnormal.Longterm,the globalP&Cinsuranceindustryneedstotakeintoaccountthepotentialforoutsizednatural disastersaswellascyberevents,inourview.Thetailwindofreservereleases,whichhaslastedforadozenyears,appearslikelytopersist based on low overall inflation, which could result in somewhat les

7、s need for price improvementincertainP&Clines.Wesaidayearagothattheperformancegapbetweenstrongandweakunderwriterswould likelywidenandwebelievethishasproventobethecase.CB,TRVandACGLledthewayin sustainedoutperformanceintheircorebusinesses.Meanwhile,AIGhasstruggled,although weanticipateimprovementin201

8、9andbeyond.RobustM&AActivity.Majoracquisitionsannouncedorcompletedduringthepastyear includeAIGbuyingValidusfor$5.6bn,andAXAs$15bndealforXL,aswellasthe consolidationofAspenandNavigators.Weexpectfurtherconsolidationofre/insurerswith weakenedperformanceand/orbelow$10bninmarketcap.Therefore,itseemsdiffi

9、cultfor investorstohaveanunderweightorshortpositioninmostsmall-midcapP&Cre/insurers, inourview.Italsoseemsreasonabletoexpectlarge-scaleM&Acouldresume.Forexample, isChubbreadyforanotherlargedeal?Personal Lines and Insurance Brokers: Favorable Results. Auto insurance marginshave improved,althoughprici

10、ngpowerhasslowed.WeexpectProgressivetocontinuetogain themostmarketshareamongthelargepersonalautoinsurers,andAllstatestop-line growthshouldalsoimprove.Theinsurancebrokers,whichareundergoingconsolidation, shouldgeneratesolidorganicrevenuegrowthandmarginexpansion.Several Opportunities in P&C. Our OW-ra

11、ted P&C stocks include Berkshire Hathaway (favorablepositioningtohighershort-termrates,andpotentialforaccretiveacquisitionsas wellassharebuybacks),AllstateandProgressive(strongearningstrendsinautoandhome insurance),Chubb (coreglobalP&Choldingwithsuperiorfranchisevalue),andArch Capital(tailwindsfromm

12、ortgageinsuranceaswellastop-tierP&Cfranchise).UsersGuide:OurLongViewreportisdesignedtoprovidecontext,analysisandinsighton keydriversoftheproperty-casualtyinsuranceindustryandthecompanies.Weprovidea deep-diveperspectiveonindustrytrendsandprojectionsinPartI-VI.Thecompanysections inthisreportprovidesum

13、maryanalysisofmajorissuesfortheP&Cstockswecover includingfundamental,quantitative,andvaluationtrends.CONTENTS HYPERLINK l _bookmark0 TheLongView:P&CRe/InsuranceMarketConditionsImproving2 HYPERLINK l _bookmark1 CatastropheRiskWillbeaDefiningFactorfortheP&CInsuranceIndustry6 HYPERLINK l _bookmark2 Par

14、tI:P&CUnderwritingResultsHitby2017-18CatastropheLosses,ResultInUpward HYPERLINK l _bookmark2 PricingTrends HYPERLINK l _bookmark3 Property-Casualty Insurance: GenerallyImprovingEnvironment14 HYPERLINK l _bookmark5 Property-Casualty Insurance Industry:SolidFundamentals28 HYPERLINK l _bookmark7 PartII

15、:CommercialP&CLines:ImprovingPricing36 HYPERLINK l _bookmark9 PartIII:ReinsurersConsolidatingAmidDynamicMarketConditions57 HYPERLINK l _bookmark11 PartIV:InsuranceBrokersDeliverSolidResults69 HYPERLINK l _bookmark13 PartV:PersonalLinesP&CReturnsareFavorable81 HYPERLINK l _bookmark15 PartVI:P&CStockP

16、erformance&Valuation100 HYPERLINK l _bookmark16 ChubbLimited(Overweight/Neutral)110 HYPERLINK l _bookmark17 Berkshire HathawayInc.(Overweight/Neutral)114 HYPERLINK l _bookmark18 TheTravelersCompanies,Inc.(Overweight/Neutral)118 HYPERLINK l _bookmark19 ArchCapitalGroupLtd.(Overweight/Neutral)122 HYPE

17、RLINK l _bookmark20 EverestReGroup,Ltd.(Overweight/Neutral)126 HYPERLINK l _bookmark21 AmericanInternationalGroup(Overweight/Positive)130 HYPERLINK l _bookmark22 HartfordFinancialServicesGroupInc.(Overweight/Positive)134 HYPERLINK l _bookmark23 RenaissanceReHoldingsLtd.(Underweight/Neutral)138 HYPER

18、LINK l _bookmark24 WillisTowersWatson(Overweight/Neutral)142 HYPERLINK l _bookmark25 ArthurJ.Gallagher&Co.(Overweight/Neutral)146 HYPERLINK l _bookmark26 Aon plc(EqualWeight/Neutral)152 HYPERLINK l _bookmark27 Brown&Brown,Inc.(Underweight/Neutral)156 HYPERLINK l _bookmark28 TheProgressiveCorporation

19、(Overweight/Neutral)160 HYPERLINK l _bookmark29 AllstateCorp(Overweight/Neutral)164FIGURE 1Barclays U.S. Non-Life Insurance Coverage Universe Industry View: NeutralStockRatingRationaleCBOWChubbwasformedin2016fromthemergerofACEandlegacyChubb.Thecompanyiswellpositionedtogeneratestrong ROEandbookvalueg

20、rowthbasedonitsglobalcommercialP&Cinsurancepresence,afavorablemarketpositioninhigh- endpersonallinesinsurance,andlong-terminternationallifeinsurancegrowthopportunities,inourview.Chubbalso benefitsfromamongthestrongestmanagementteamsintheindustrywithafavorablereserveposition.Wewouldexpect thecompanyt

21、opursueadditionalmid-to-largesizedacquisitions.BRKOWBerkshireHathaway,ledbyWarrenBuffett,appearswellpositionedtobenefitfromeconomicexpansion,highershort-term interestrates,potentialfutureaccretiveacquisitions,andsharebuybacks.WarrenBuffett,age88,couldstillbeCEOfora numberofyearsanduncertaintyaroundh

22、issuccessionplanshasbeenlargelyresolved,inourview.Berkshirenowhas$90+bnofdeployablecashavailableforaccretiveacquisitionstosupplementorganicgrowth,whichwewouldexpecttobe immediatelyaccretivetoEPS.BerkshiressubstantialinvestmentinKraftHeinzisnowanareaofweakness,givenrecent weakperformance,inourview.HI

23、GOWTheHartfordscorebusinessesincludescommerciallinesandpersonallinesP&C,groupbenefits,andmutualfunds.The companyssaleofitsTalcottResolutionunit,whichconsistedprimarilyofrunoffvariableannuitybusiness,hasresultedin thewelcomeexitofalow-ROE,non-corebusiness.HartfordsannouncedacquisitionofspecialtyP&Cin

24、surersNavigators, anditscompletedpurchaseofAetnasUSgrouplifeanddisabilityinsurancebusinessshouldexpanditspresencein productlineswithfavorablegrowthpotentialandattractivemargins.Sharebuybacksareexpectedtoresumeinlate2019.AIGOWAIGhasatop-tiermanagementteamandshouldgenerateROEimprovementfromalowbase,in

25、ourview.Theroadto recoveryforAIGhasbeenuneven,butweexpectsustainedprogressintheyearsahead,drivenbyitsnewmanagement team.In2019,AIGanticipatesdeliveringaP&Cunderwritingprofitbyreducinglargecoveragelimits,reducingnet exposuresafterreinsuranceprotection,limitingmulti-yearinsurancedeals,andreducingexpen

26、ses.AIGsplantoachievea 10%ROEgoal(ex-DTA/AOCI)by2021isdrivenbyexpectationsofachangingbusinessmix,exitingunderperforming businesslines,andimprovingperformanceinP&Clinesalreadygeneratinganunderwritingprofit.REOWEverestRehasastrongreinsurancebusinesswithasmaller(althoughfaster-growing)primaryinsurancep

27、resence.The companyhassufferedlargecatastrophelossesoverthepasttwoyearsalongwithotherre/insurers.Inanimproving pricingenvironment,weanticipateEverestcandeliverdecenttop-linegrowth,an11%ROE,andstrongbookvaluegrowth. EverestappearstohavelittleappetiteforM&A,unlikeotherreinsurers.Thecompanyscapitalbase

28、issizablewhichmeans itisimportanttomajorcustomersandsmallenoughtobenimble.CEODomAddessohasannouncedhisplantoretire;the boardplanstoexploreinternalandexternalcandidatesforhisreplacement.TRVOWTravelersisatop-tierP&Cinsurer,inourview,withadomesticfocusonbothcommercialandpersonallines.Weviewthe companya

29、shavingamongthebesttrackrecordsintheindustryofgeneratingfavorableunderwritingresultswith conservativereservingpracticesaswellasafavorablelowdouble-digitROEprofile.Thecompanyhasfacedchallenges generatingfavorablepersonallinesunderwritingresults,butweviewitasbeingonapathtowardimprovement.Travelers has

30、appearedinterestedinpotentialacquisitions(bothbolt-onandlargescale)toincreaseitsROE,reducevolatility,oradd astrategiccapabilityalthoughwewouldexpectitsfocustoremainondomesticopportunities.ACGLOWArchCapitalisamongtheindustrysmostdisciplinedP&Cunderwriters,inourview.Weanticipatemodestannual increasesi

31、npremiumvolumeinbothP&CInsuranceandReinsurance.Archsmortgage(re)insuranceunitcouldaccount forthevastmajorityoftotalunderwritingincomeoverthenextseveralyears,withastrongerreturnprofilethanitsP&C units.Managementhasappearedopentobolt-onP&Cacquisitionsincludingaddingunderwritingteams,renewalrights tran

32、sactions,andbuyingbooksofbusiness.ThecompanyhashadsomeexecutivesleaveforAIG,althoughweviewArch ashavingastrongbenchofmanagementstrength.RNRUWRNRisamongthebest-managedreinsurers,inourview,withalong-termtrackrecordofeffectiveriskmanagementas wellasbookvaluepersharegrowth.RenReviewsitsbolt-onacquisitio

33、nofTokioMillenniumResbusinessasfittingwell withitsexistingbookofbusinessbasedonthelinesitexpectstoretain.WebelieveRNRcouldbeopentoadditionalbolt- ontransactions.RenReappearslikelytomaintainitscurrentindependentstrategiccoursedespiterecentactivistinvestor pressure,andanyimpliedboostinitsvaluationfrom

34、apotentialtakeoverislargelyunwarranted,inourview.WLTWOWWillisTowersWatsonwasformedbythemergerofWillisGroupandTowersWatson.ThiscombinationtransformedWillis fromapure-playglobalinsurancebrokertoonewithcorecapabilitiesinconsulting,employeebenefits,andprivatehealth insuranceexchange.WLTWappearsconfident

35、initslong-termtargetofdouble-digitadjustedEPSgrowth,althoughits19 growthratecouldbenegativelyimpactedbypension,taxrateandFX.Inourview,itisunclearwhetherWLTWcouldre- engagewithAonasapotentialmergerpartner,orwhetheranotherpotentialbuyercouldemerge.WLTWsCEOJohn Haleyssuccessionplanningisongoing;wethink

36、aninternalsuccessoristhemostlikelyoutcome.AJGOWAJGallaghershouldbenefitfromflat-to-slightlyupP&Cpricing,exposuregrowthastheeconomyexpands,andstrong organicrevenuegrowth.AJGappearsmorefocusedonorganicgrowththanmarginexpansion,althoughmargin expansionappearslikelybasedonexpectationsoffavorableorganicr

37、evenuegrowth.AJGsRiskManagementsegment couldalsoshowfavorabletop-linegrowthalongwithmostlystablemargin.Thecompanyhascontinuedtosupplementits growthwithbolt-onacquisitions,andoursenseisthecompanycouldbeoperationallyreadyforalargerdeal.Source: Company Data, Barclays ResearchNote: Stock Rating: OW: Ove

38、rweight; EW: Equal Weight; UW: Underweight.FIGURE 2Barclays U.S. Non-Life Insurance Coverage Universe Industry View: Neutral (continued)StockRatingRationaleBROUWBrown&Brownisapure-playinsurancebroker;nearlyallrevenuesarecommission-basedandtypicallybenefitfromrising commercialP&Cinsurancerates.BROals

39、obenefitsfromanUSeconomicexpansionleadingtoincreaseddemandfor commercialinsurance.WeviewBROasawell-runinsurancebrokerwithstrongexpensedisciplineandindustry-leading margins.BROcontinuestodeployexcesscapitalmostlyintobolt-onacquisitionsofinsuranceagents,althoughdeal valuationshaveincreased.In2018,thec

40、ompanydeliveredthelargestacquisition-relatedrevenueinitshistory.Weview BROsvaluationaselevatedcomparedtootherinsurancebrokers.AONEWAonshouldbenefitfromP&Cexposuregrowthandstabilizingcommercialre/insurancerates,similartootherinsurance brokers.Aontargetsatleastmid-singledigitorganicrevenuegrowthoverth

41、elongterm.Managementhasalsoappeared confidentthereissignificantopportunityformarginexpansion.Asapointofreference,Aonhasexpandeditsmarginsby 70-80bpsannuallyonaverageoverthelastdecade.InMarch19,Aonsaiditwasexploringanall-stockcombinationwith WLTW,althoughAonbackedawayfromthisstanceonlyonedaylater.Iti

42、sunclearwhetherAonand/orWLTWcouldre- engageonthispotentialtransaction,inourview.ItalsoraisesthepossibilityofAonpursuinganotherlargetransaction,in insurancebrokerageorelsewhere,webelieve.ALLOWAllstateshoulddeliverongoingfavorablemarginsalongwithimprovedgrowthinitsautoandhomeinsurance.Notably, thecomp

43、anyprovidedevidencein2017-18ofitsstrongcatastropheriskmanagementframework.Allstateanticipatesa 2019overallunderlyingP&Ccombinedratioof86%-88%,whichweviewasconservativesincethecompanyhasbeatits annualguidanceeveryyearforatleastthepastdecade.Robustsharebuybackactivityisexpectedtocontinue.ALLshould gen

44、erateanattractive15%ROEin2019/20,basedonourprojections.Bolt-onacquisitionsofSquareTradeandInfoArmor shouldextendAllstatespresenceininsuringpersonaldevicesandidentityprotection.PGROWProgressiveispoisedtocontinueitstrackrecordofindustry-leadinggrowth,marginsandROEinthepersonallinesP&C market,webelieve

45、.Thecompanyshouldcontinuetobethemostsuccessfulautoinsurerintermsofgainingprofitable marketshare.WeexpectPGRtodeliverstrongtop-linegrowthwithfavorableunderwritingmargins.WeprojectPGRs ROEcouldbeinthemid-to-high20%range,whichwouldlikelybethebestresultamonganyP&Cinsurerwecover.PGRs personalautopolicies

46、in-force(PIF)growthiscurrentlythefastestamonganylargeinsurer.Thecompanyviewsbundling autoinsurancewithitshomeownerscoverageasasignificantlong-termgrowthopportunity.Source: Company Data, Barclays ResearchNote: Stock Rating: OW: Overweight; EW: Equal Weight; UW: Underweight.CatastropheRiskWillbeaDefin

47、ingFactorfortheP&C InsuranceIndustryCatastropheriskwillbeamajorthemedrivingtheproperty-casualtyinsuranceindustryin theyearsahead,inourview.2017-18wasthelargesttwo-yearperiodofinsuredcatastrophelossesonrecord,including major hurricane, wildfire, flooding and typhoon events. Travelers CEO Alan Schnitz

48、ers assessmentonthistopicinhismostrecentlettertoshareholdersisworthnoting:“.ineach ofthelastthreedecades,averageannualinsuredcatastrophelossesintheUnitedStates haveincreasedcomparedtothepriordecade,andcatastrophelossesin2018and2017 wereamongthehighestoverthelast10years.Thistrendisdueinparttodemograp

49、hic changes, such as population growth and urban expansion, as well as other factors, includingchangingclimateconditions.”Webelievecatastropheriskhaschangedthenarrativeoninvestingininsurancestocks becausethere/insurersthatmosteffectivleymanagetheirrisk(includingCB,TRV,BRK, ACGL,PGRandALL,inourview)t

50、endtobeawardedhighvaluations.Investorswilllikely rewardthosere/insurersthatcangenerateconsistentresultsdespiteelevatedcatastrophe lossactivity,andpunishthosethatfallshort.Therecanbesomedebateastohowmuchclimatechangeistherootcauseofthese events, but what is clear in our view is that the frequency and

51、 severity of natural catastropheeventshasincreased.Forexample,HurricaneHarveyin2017resultedin approximately$30bnofinsuredpropertydamage,mostlyfromfloodingratherthanwind. Inaddition,Californiawildfiresalsocausedapproximately$30bnofinsuredlossesin2017-18.HurricaneMichael,whichimpactedFloridainOctober2

52、018,wasthestrongesteventin termsofmaximumsustainedwindspeedtostriketheUSsinceHurricaneAndrewin1992.FIGURE 3Global Insured Catastrophe LossesIn$bnUShurricanesGlobalearthquakeHurricanesandandwildfires$139$85$77$64$60$56$52$28$36$30$38$18$232000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 20

53、12 2013 2014 2015 2016 2017 2018Source: Swiss Re Institute, Munich Re NatCatSERVICE, RMS, Barclays Research estimatesNote: Includes inflation-adjusted insured losses from natural catastrophe and man-made disasters.Therearemajorrepercussionsfortheglobalproperty-casualtyindustry,inourview,ifthe trendo

54、felevatednaturalcatastropheactivitypersists.Forexample,weexpect:Primary insurers will focus on managing their catastrophe exposure, including windstorm,wildfire,flood,andearthquakerisk,bymonitoringandadjustingtheirgross policy limits exposed through underwriting actions and reinsurance, increasing c

55、ustomersriskparticipation,andraisinginsurancerates.Total insured catastrophe lossesin2017-18werelargest onrecordReinsurerswillincreasepartnershipswiththird-partycapitalproviderstolimittheiron- balancesheetexposuretomajorcatastropheeventsandgeneratefeesforsourcing business.Insurancebrokerswilladdvalu

56、ebyfindingcatastropheriskre/insurancecapacityfor theirclients,spreadingtheriskintheglobalre/insurancemarket,andworkingwith re/insurerstocalibratetheirexposures.Intermsofnon-naturalcatastropherisk,webelievethereisthepotentialforongoinglarge claimeventsincyberinsurance.TheP&Cinsuranceindustryviewscybe

57、rinsuranceasa growthopportunity.However,webelievethiscoveragecouldultimatelybeunprofitablefor insurers, based on the potential for an elevated incidence of large industry losses. Companiesalreadyfacinglargecyberlosses,someofwhichdidnothavecoverageor coveragethatwasinadequaterelativetoexposures,inclu

58、deEquifax,Merck,Maerskand FedEx.PartI:P&CUnderwritingResultsHitby2017-18Catastrophe Losses, Result In Upward Pricing TrendsTotal insured catastrophe losses in 2017-18 were the largest on record, resultingin sustainedimprovementinP&Cmarketconditions.Thesecatastrophelosses,includingUS hurricanesandwil

59、dfiresandinternationalnaturaldisasters,wereaseriesofearningevents fortheglobalproperty-casualtyinsuranceindustry,ratherthancapital-impairingevents.However,webelievethenarrativehaschanged,witheventsduringthepasttwoyearsnow beingincreasinglyviewedasthenewnormal.Forexample,thepasttwoyearshavebrought te

60、ns-of-billionsofCaliforniawildfirelosses.Untilnow,theselargeeventswerelargelynot includedaskeyratingfactorsinP&Cinsurancepolicies.Animprovingeconomicpictureshouldhelplifttop-linegrowthforP&Cinsurersand brokers,andstabilizingpricingtrendsshouldmodestlyliftunderlyingmargins.M&Aactivity remainsrobustwi