Excess and surplus lines (E&S) insurance premium recorded by the 15 managing service offices in the United States increased 9.4 percent as of the 2018 mid-year point, the Surplus Lines Stamping Office of Texas (SLTX) reports.
Total premium reported reached $15.7 billion, approximately $1.4 billion more than was recorded in 2017, according to a mid-year analysis conducted by SLTX.
Total transactional filings also have increased, with 2.2 million filings made through the first two quarters of the year. This total represents a 5 percent growth over 2017. Seven states — Illinois, Minnesota, North Carolina, Nevada, Oregon, Pennsylvania, and Utah — saw an increase in filings larger than 10 percent.
California experienced the largest decrease, recording 320,905 filings, down from 348,498 in 2017. While the decrease may seem significant, the expectation is that California will continue to see surplus lines premium growth.
The four largest states — California, Florida, Texas and New York — saw increases in premium volume of 8 percent, 10 percent, 11 percent, and 13 percent, respectively. These offices represent a majority of the US premium value, totaling $12.1 billion of the total $15.7 billion mid-year value. These states are ranked as the most populous among the group, giving rise to the large premium amounts reported each year.
Additionally, the southern region of the US, consisting of Florida, Texas, North Carolina and Mississippi, accounted for $6.95 billion in premium, the largest of all regions. Though 92 percent of the region’s premium was reported by Florida and Texas, North Carolina and Mississippi also had increased filings in 2018 over 2017.
Washington and Utah saw the greatest premium spikes of 18 percent and 16 percent, respectively. Improved market changes came from three other western states with reported E&S premium increases: Oregon (9 percent), Arizona (8 percent), and Idaho (7 percent).
“Premium among the E&S service and stamping offices have exhibited a 67 percent increase over the past seven years,” SLTX CEO Norma Carabajal Essary, said in the group’s announcement. “We are quite impressed with the national growth, and more specifically, in Texas, we are already experiencing 2018 mid-year increases in coverage areas such as flood (40 percent), directors and officers (74 percent), errors and omissions (6 percent), and cyber liability (15 percent).”
Overall, the 2018 mid-year review provides a positive snapshot, as the industry is experiencing growth in all regions across the country. Against a backdrop of natural catastrophes, politics, and technological advances, the market is well-aligned to withstand what the future may bring.
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