Search
 

E&S marketplace girds itself for greater competition

ONE OF the key roles of the excess and surplus-lines marketplace is to function as a "relief valve" during hard markets. When standard insurers start restricting their underwriting or pull out of certain states or classes of business altogether,

By Harmony Nicole Fortenberry | Updated on February 28, 2005

ONE OF the key roles of the excess and surplus-lines marketplace is to function as a “relief valve” during hard markets. When standard insurers start restricting their underwriting or pull out of certain states or classes of business altogether, affected risks have always been able to turn to the E&S markets. The relief-valve role was amply demonstrated during the recent hard market, when direct premiums for E&S insurers rose by 62% in 2002 and a still-healthy 28% in 2003, according to A.M. Best. At the end of that year, the E&S market accounted for 13.1% of commercial-lines premiums, Best’s noted, up from 6.1% a decade earlier.

In some states, the move to the E&S marketplace was even more pronounced. In California, the leading state in the country for E&S business, E&S premiums were up 104.5% in 2002 and 43.1% in 2003, according to the Surplus Lines Association of California. But in 2004, growth dropped sharply to 8.4%, according to information the association released in January. Undoubtedly, E&S business was off substantially around the country, as standard carriers, in better financial shape after several years of hard-market premiums, began to once again eye business they’d let go three or four years earlier.

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.

INCLUDED IN A DIGITAL MEMBERSHIP:

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

PropertyCasualty360

Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join PropertyCasualty360.com now!

  • Unlimited access to PropertyCasualty360.com - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including BenefitsPRO.com, ThinkAdvisor.com and Law.com
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2024 ALM Global, LLC. All Rights Reserved.