Surplus line premiums continued growth in 2020
All 15 stamping offices reported premium growth in 2020, with more than half seeing double-digit increases.
Surplus line premiums continued to grow during 2020, according to state stamping office data, increasing 14.9% compared with the year prior.
In total, 2020 surplus premiums in stamping offices surpassed $41.7 billion, the Wholesale & Specialty Insurance Association (WSIA) reported. Each of the 15 stamping offices saw premiums rise this past year, with 11 reporting double-digit increases.
While item counts were down 1.3% overall, nine states did report growth in this area.
Premium growth along with increasing premiums per transaction are signaling a hardening market, according to Dan Maher, executive director of the Excess Line Association of New York.
“However, the overall reduction in transactions suggests the industry is battling some headwinds due to economic conditions resulting from COVID-19,” Maher said in a release.
Gary Pullen, executive director of the Florida Surplus Lines Services Office (FSLSO), noted his organization saw a 6% decrease in item count during 2020. He explained the drops in policy count can be attributed to big declines in personal liability, HO-3 and inland marine (personal policy counts). Coverages with the largest policy count gains, according to FSLSO data, were commercial property, flood (personal, dwelling property) and excess commercial general liability.
“Surplus lines premium reported to FSLSO exceeded $7.5 billion for the first time in 2020 and experienced a 13%, or $894 million, premium increase,” Pullen said. “This is the third consecutive double-digit increase for premium, and every quarter experienced record premium for the period.”
The Surplus Line Association of Utah (SLAU) also had a record-breaking year for premium and item counts, according to Sylvia Bruno, SLAU executive director. She explained large increases in general liability, as well as fire and allied lines, drove much of the growth for premiums.
Utah and Idaho saw the largest increases in premium volume this past year, WSIA reported.
As prospects grow for further federal financial relief and the COVID-19 vaccine continues to be rolled out, stamping office officials are hopeful the economy will stabilize and strengthen surplus lines into 2021, WSIA reported.
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