A Review of the Little Report of Rates of Return in the Property Liability Insurance Industry [Discussion]

Anyone familiar with the insurance business must sense intuitively that there is something unreal about the two reports by Arthur D. Little, Inc. on the property and liability insurance industry. The first report, which will be called in this review, for brevity’s sake, “Prices and Profits,” said that the business was “underearning” and the second report, “Rates of Return,” said that the industry’s rate of return of 3.634% fell below the average interest rate paid by most savings banks.