After an extremely difficult 2012, and some lean years both during and immediately following the end of the recent recession, many property and casualty insurance companies across the U.S. have found themselves in some uncomfortable financial positions. However, that all changed in 2013, because there were numerous improvements for these companies more or less across the board.

In all, private property and casualty insurance companies operating in the U.S. saw net income after taxes spiked to $63.8 billion over the course of 2013, an increase of nearly 82 percent from the just $35.1 billion seen a year earlier, according to new data from the Property Casualty Insurers Association of America. Overall rate of return, which is a good measure of profitability overall, is likewise up to 10.3 percent, from the previous year's 6.1 percent. That's the largest rate of return seen since 2007, prior to the real onset of the recession, when it came to 12.4 percent.

A sizable portion of the overall improvement for the industry came as a result of significantly improved underwriting, the report said. In all, net gains on underwriting came to $15.5 billion last year, representing a nearly 200 percent increase from the numbers seen in 2012, when this aspect cost companies net losses of $15.4 billion.

Why did these improvements come?
The good news for insurers in this regard is that they can probably expect more improvements as long as weather conditions and other factors across the country remain more or less as they were in 2013, the report said. The reason losses were so massive in 2012 was the result of not only Hurricane Sandy devastating several parts of the Eastern Seaboard, but also other major disasters that took a significant toll on many insurers' bottom lines.

But without any such major incidents seen last year, these companies simply got to hold onto the money they'd set aside to cover losses suffered by policyholders, the report said. Robert Gordon, PCIAA's senior vice president for policy development and research, noted that this will help insurers to continue building their finances so that they're better prepared for the next time a major disaster strikes.

Companies may want to consider the ways in which they can continue to beef up their bottom lines in these days of better incomes so that they can set themselves up to better weather whatever potential storms come along later. The more that can be done in this regard, the healthier companies' finances will be overall.