According to a Moody’s Investors Service report, U.S. property and casualty insurers’ first quarter net income rose 70 percent over the first quarter of 2011 due to premium growth and lower catastrophe losses.

However, the report suggests, "investment income remains weak and reserve releases continued their moderating trend through the first quarter, prompting companies to turn up the dial on rate increases to meet return targets."

Rate increases have included nearly all lines of business, with net premiums up 4 percent year over year as a result of rate increases and exposure growth. The report indicates that Moody’s expects "accident-year loss ratios will improve as premiums are earned and loss costs remain relatively benign." The ratings firm also expects overall reserve releases to decline, though workers’ compensation is a line that should be watched for possible adverse reserve development.