In an August review of the excess and surplus lines (E&S) market, A.M. Best noted that E&S enjoyed banner years in the not-so-distant past. “Direct premiums grew by 225 percent from year-end 2000 through year-end 2003 for domestic professional surplus lines companies,” it said. However, it went on to note that with a softening market in 2004, premiums flattened in 2005, grew a bit in 2006, and declined a bit in 2007. Then along came 2008. While final figures for 2008 are still being gathered, it was, by all accounts, a year that many were glad to see end.

“I've been through a lot of ups and downs in my 40 years in this business, and this past year was a unique 'down,'” said Tom Enright of Enright & Wilson in Hollywood. Enright, whose firm writes commercial risks, mainly P&C and professional liability, reported rates in the E&S market were “20, 30, or even 50 percent lower than the year before. I'm hopeful that 2009 will be a better year for all of us. I sure don't see how it could be any worse.”

The National Association of Professional Surplus Lines Offices' (NAPSLO) Executive Director Dick Bouhan may have good news for Enright and others. “We think the worst of the soft market in most segments is over,” he said. “Our sense is that the declines are stopping. We're hearing little bits of optimism here and there. 'Stable' is the word I keep hearing. Although where it goes from here, we're not quite sure.”