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I.I.I. Says Almost No Correlation Between President's Party and P/C Profitability

The Insurance Information Institute is out with a special report that says that historically, there is virtually no correlation between the political affiliation of the...
November 2, 2004

The Insurance Information Institute is out with a special report that says that historically, there is virtually no correlation between the political affiliation of the President's party and performance (as measured by return on equity) in the P/C insurance business. The analysis looked at the P/C industry's profitability since 1950.

Over the past 55 years, the p/c insurance industry has experienced an average rate of return of 8.0 percent under Democratic administrations and 7.9 percent while Republicans were in control of the White House. The highest average return for any 4-year period occurred during the Carter administration (1977-1980), with a return on equity of 16.4 percent, followed by 15.1 percent during Ronald Reagan's second term (1985-1988).  The lowest return, at 3.6 percent, occurred during the Kennedy/Johnson administration (1961-1964). The presentation also includes a table showing the results of a recent survey of securities brokerages firms as to which industries would be favored under Bush or Kerry administrations.

"Presidential Politics & Profitability in Property/Casualty" (By Dr. Robert P. Hartwig, 11/1/04)