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Life And Health Industry Profits Fall Sharply

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NU Online News Service, Jan. 8, 11:23 a.m. – U.S. life and health insurers reported a total of $3.4 billion in profits for the first half of 2002, down from $8.4 billion for the first half of 2001, according to Weiss Ratings Inc., Palm Beach Gardens, Fla.

Weiss is blaming much of the decline on investment losses. Life and health insurers lost $6.5 billion in capital in the first half of 2002, up from a $2.2 billion capital loss for the comparable period in 2001, Weiss says.

U.S. life and health insurers usually limit exposure to the stock market, but many do hold some stocks in their portfolios. The weak stock market reduced the carriers’ total capital and surplus to $226 billion June 30, 2002, down from $235 billion a year earlier.