Alabama Firm Foundation

KEY FACTS: THE INSURANCE INDUSTRY’S CONTRIBUTION TO THE ALABAMA ECONOMY

The insurance industry in Alabama has a significant impact on the state’s economy that extends well beyond its responsibilities to collect premiums and settle claims. It employs licensed professionals, pays taxes, owns municipal bonds and serves people in their times of greatest need.

EMPLOYMENT

U.S. Department of Commerce data show the insurance industry provided 37,319 jobs in Alabama in 2014. The Alabama insurance industry accounted for about $2.5 billion in compensation in 2014.

GROSS STATE PRODUCT

The insurance industry contributed $3.6 billion to the Alabama gross state product (GSP) in 2013, accounting for 1.86 percent of the state GSP.

TAXES

Premium taxes paid by insurance companies in Alabama totaled $304.4 million in 2014.

PREMIUMS

Direct premiums written by property/casualty insurance companies in Alabama totaled $7.5 billion in 2014. In addition, premiums written by life/health insurance companies totaled $7.2 billion (including life insurance, annuities, accident and health insurance, deposit type funds and other considerations).

SURPLUS LINES

The surplus lines market, a group of highly specialized insurers, exists to provide coverage that is not available through licensed insurers in the standard insurance market. For the many thousands of businesses that rely on some level of surplus line protection to keep their doors open, surplus lines is an important segment of the market. The Alabama surplus lines market accounted for $508.6 million in gross premiums written in 2014, according to a survey by Business Insurance.

CLAIMS PAYMENTS

Insurance company claims payments help ensure the economic security of individuals and businesses and help sustain a number of related industries. In 2014 these payments in Alabama as measured by direct property/casualty incurred losses, were $4.1 billion. Life insurance claims and benefits payouts in Alabama totaled $5.5 billion in 2014, on a direct basis before reinsurance, and includes life insurance, death benefits, matured endowments, annuity benefits and other life insurance benefits. Does not include accident and health.

CATASTROPHES

The insurance industry plays a vital role in helping individuals and businesses prepare for and recover from the potentially devastating effects of a disaster such as a catastrophic hurricane or storm or wildfire. The total value of insured coastal property in Alabama was $118.2 billion in 2012, accounting for 13 percent of the state’s total insurance property exposure, according to AIR Worldwide Corporation. Three of the 10 costliest hurricanes in U.S. history have impacted Alabama: hurricanes Katrina and Rita in 2005 and Hurricane Ivan in 2004. Alabama is also prone to tornadoes and wildfires. In April 2011 a devastating outbreak of tornadoes in Tuscaloosa killed 238 and destroyed 5,300 homes. Alabama ranked 12th in the nation for the number of tornadoes in 2015 with 32 storms. The state ranked fourth for the number of wildfires with 3,198 fires that burned 47,380 acres.

LEADING WRITERS

 

LEADING WRITERS OF COMMERCIAL PROPERTY/CASUALTY INSURANCE IN ALABAMA BY DIRECT PREMIUMS WRITTEN, 2014 (1)

 

Rank Group/company Direct premiums written ($000) Market share
1 Travelers Companies Inc. $199,848 6.4%
2 American International Group (AIG) 178,580 5.7
3 Zurich Insurance Group (2) 132,092 4.2
4 Liberty Mutual 129,830 4.2
5 Auto-Owners Insurance Co. 118,452 3.8
6 CNA Financial Corp. 102,720 3.3
7 Cincinnati Financial Corp. 99,294 3.2
8 Nationwide Mutual Group 97,298 3.1
9 ACE Ltd. 85,745 2.8
10 State Farm Mutual Automobile Insurance 72,288 2.3

(1) Before reinsurance transactions.
(2) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by SNL Financial.

Source: SNL Financial LC.

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LEADING WRITERS OF HOMEOWNERS INSURANCE IN ALABAMA BY DIRECT PREMIUMS WRITTEN, 2014 (1)

Rank Group/company Direct premiums written ($000) Market share
1 State Farm Mutual Automobile Insurance $484,059 29.9%
2 Alfa Mutual Group  218,189 13.5
3 Allstate Corp. 175,119 10.8
4 Farmers Insurance Group of Companies (2) 104,450 6.5
5 USAA Insurance Group 98,028 6.1
6 Travelers Companies Inc. 85,879 5.3
7 Liberty Mutual 57,132 3.5
8 Nationwide Mutual Group 50,674 3.1
9 COUNTRY Financial 44,732 2.8
10 Auto-Owners Insurance Co. 34,955 2.2

(1) Before reinsurance transactions.
(2) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by SNL Financial.

Source: SNL Financial LC.

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LEADING WRITERS OF LIFE INSURANCE AND ANNUITY CONSIDERATIONS IN ALABAMA, 2014 (1)

 

Rank Group/company Premiums and annuity considerations ($000) Market share
1 New York Life Insurance Group  $363,525 6.2%
2 Lincoln National Corp.  332,098 5.7
3 Jackson National Life Group  315,123 5.4
4 American International Group (AIG) 286,249 4.9
5 MetLife Inc.  238,086 4.1
6 Prudential Financial Inc. 207,904 3.6
7 Mutual of America Life Ins.. Co. 199,490 3.4
8 Allianz Group  191,972 3.3
9 Northwestern Mutual Life Ins. Co.  178,051 3.1
10 AEGON  176,373 3.0

(1) Includes life Insurance, annuity consideration, deposit-type contract funds and other considerations; excludes accident and health insurance from life/health insurers. Before reinsurance transactions.

Source: SNL Financial LC.

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LEADING WRITERS OF PRIVATE PASSENGER AUTO INSURANCE IN ALABAMA BY DIRECT PREMIUMS WRITTEN, 2014 (1)

Rank Group/company Direct premiums written ($000) Market share
1 State Farm Mutual Automobile Insurance $649,839 24.6%
2 Alfa Mutual Group 390,120 14.8
3 Allstate Corp. 288,854 10.9
4 Berkshire Hathaway Inc. 250,510 9.5
5 Progressive Corp. 181,685 6.9
6 USAA Insurance Group 164,216 6.2
7 Nationwide Mutual Group 95,427 3.6
8 Farmers Insurance Group of Companies (2) 76,815 2.9
9 Liberty Mutual 69,498 2.6
10 Travelers Companies Inc. 59,756 2.3

(1) Before reinsurance transactions.
(2) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by SNL Financial.

Source: SNL Financial LC.

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