Abstract: This paper examines the performance of property and liability reinsurance companies in the United States. It shows that these reinsurers have higher mean values than primary insurers in the following financial ratios: net operating income to net premium earned (NOI/PE), yield on invested assets (YIA), and loss reserves to net premium written (LR/NPW). Primary insurers, on the other hand, have higher mean values in the combined ratio (CRAD), the return to policyholders ’ surplus (RPHS), and net premiums written to policyholders ’ surplus (NPW/PHS). A further study using least square regression analyses indicates that being a professional reinsurer significantly raises a firm’s combined ratio and lowers its return to policyholders ’ surplus. On the other hand, being a reinsurer has no significant effect on net operating income, yield on invested assets, change in policyholders ’ surplus, change in premium written, or current liquidity.
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