Frequently Asked Questions

Guidelines for Citing BEA Information | ID: 199 | Created: Mar-15-2006

How are property and casualty insurance services measured in GDP?

BEA's measure of property and casualty insurance services that is included in GDP is an estimate of the value of the services provided by the insurance company to its policyholders. Insurance companies provide financial protection to policyholders through the pooling of risk, and they provide financial intermediation services through the investment of reserves that are held to help cover extraordinary losses. After accounting for investment income, insurance companies set premiums to cover the expected costs of providing the services, of settling claims, of maintaining reserves against future claims, and of purchasing reinsurance.

Therefore, services of the property-casualty insurance industry are measured as direct premiums earned plus "premium supplements" -- that is, the expected investment income earned from the investment of reserves that are directly attributable to policyholders because of prepayment of premiums or accrual of benefits -- minus normal losses incurred and dividends paid to policyholders. The normal losses are calculated on the basis of historical experience. Because the measurement of insurance services uses normal losses rather than actual losses, the measure does not exhibits large swings when disasters take place.

The value of disaster-related insurance payouts are recorded as capital transfer payments, which are presented in NIPA table 5.11.

Ask us a question...

"How are property and casualty insurance services measured in GDP? "
Your email address
Your question
What is 10 + 3? (Spam protection)

Double check that email address! | We won't be able to contact you if it is incorrect.

Why the math question? | This helps stop malicious programs from using this site to generate SPAM email.

Please allow us some time | It could take up to two(2) business days for our Subject Matter Experts to follow up with an appropriate answer to your question(s). Your patience is very much appreciated.

Need Help?

Using the FAQ database | All FAQs are displayed when first visiting the page. They are ordered by most recent or recently updated and can be filtered by keyword search term, by category, and by manually selecting the page number buttons. To view any FAQ, click on the title to open the answer. Submitting a question is done by selecting the “Ask a question” tab along the top of the FAQ.

Selecting an FAQ | Clicking on the title of the FAQ will bring up the answer to the FAQ. Navigating back to the list of FAQs is done by selecting the tab “Latest FAQs”. A tab to ask a question specifically about this FAQ can be found at the top of the answer. Also, the FAQ id and date this FAQ was created or last modified is shown in the upper right hand corner.

Searching the FAQs | Enter a keyword search term and click the Search button to narrow FAQ selections. To return to all FAQs, click the Clear button or clear the keyword search field and click the Search button.

Filtering FAQs by category | Chose the category to filter by and click Apply button. This will display only the FAQs related to an assigned category. To return to all FAQs click the Clear button next to the search by keyword field or select ALL from the drop down menu and click Apply button.