Autonomous, an independent investment research firm, expects the second-quarter 2026 earnings season for US property and casualty (P&C) insurers to centre on slowing commercial insurance pricing, the balance between profitability and growth in personal lines, and the ability of insurance brokers to maintain organic growth in a softer market environment.
The firm expects most commercial lines insurers to post another solid underwriting performance for the second quarter, despite the ongoing possibility of losses from non-catastrophe weather events.
However, Autonomous believes investor attention will increasingly shift towards the pace of pricing declines, with commercial insurance rates continuing to moderate across both admitted and excess and surplus markets.
Although the effect of lower pricing has not yet been fully reflected in underwriting margins, Autonomous notes that analysts’ premium growth forecasts have become less optimistic since the start of the year. The firm says this follows reports from insurers of rate reductions exceeding 30% across parts of the US large-account property market.
Autonomous feels current expectations for low single-digit premium growth remain challenging and says any signs of weaker-than-expected top-line performance are likely to attract significant scrutiny. With insurers continuing to prioritise underwriting discipline rather than expanding market share, the firm expects investors to focus on management commentary about growth prospects for the remainder of 2026. In particular, Autonomous expects questions around whether growth trends will differ across individual product lines and customer segments.
Within personal lines, Autonomous says the discussion continues to revolve around the trade-off between maintaining underwriting margins and pursuing faster policy growth. The firm notes that Progressive previously indicated that some consumers who shop for insurance less frequently had begun returning to the market after premium reductions encouraged more quote comparisons. However, policies-in-force growth during April and May largely followed the normal seasonal slowdown.
Autonomous says both leading personal lines insurers continue to generate combined ratios comfortably ahead of long-term averages, leaving investors keen to understand how much profitability companies may be prepared to sacrifice in order to increase market share. The firm believes catastrophe budget inflation is unlikely to have a meaningful effect on second-quarter results and expects the personal motor market to continue benefiting from moderate favourable reserve development.
Autonomous maintains its preference for Progressive over Allstate, arguing that Progressive is better positioned to protect underwriting margins while continuing to expand its personal motor policies-in-force.
For insurance brokers, Autonomous believes market sentiment remains cautious as investors assess the effect of softer insurance pricing and broader economic uncertainty on full-year mid single-digit organic growth expectations. The firm expects second-quarter share price performance to depend largely on whether brokers can provide greater confidence that organic growth is beginning to stabilise.
Autonomous notes that second-quarter comparisons will be affected by the heavy primary property renewal season, together with continuing reinsurance rate reductions of between 15% and 20% at mid-year renewals. Against that backdrop, the firm forecasts slower year-on-year organic growth across much of the broking sector.
During the earnings season, Autonomous expects investors to seek further detail on brokers’ outlook for the 2026 P&C market and wider economic conditions, the sustainability of current operating margins and future capital returns as valuations for smaller acquisitions begin to normalise. The firm also expects companies to face ongoing questions about their use of artificial intelligence, although it believes this will remain a less significant issue than market conditions and growth prospects.
