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Program business premium rose 12.2% in 2018, reaching $40.5 billion from $36 billion in 2016, according to The 2019 State of Program Business Study published by the Target Markets Program Administrators Association (TMPAA).
Program business again outpaced the total property/casualty industry, which grew commercial lines premiums by only 9.97 percent in 2018.
“Since launching the study in 2011, we have tracked program business’ phenomenal expansion, including premium growth, which is a key measure of success,” said Ray Scotto, executive director of TMPAA. “The data we collected from this year’s survey shows that program business continued to be a growing and vibrant market in 2018.”
Program administrators who participated in the poll reported growth in their business and expressed great optimism about the future of the program space, Scotto says.
The TMPAA released the results of its bi-annual The State of Program Business Study at the association’s 19th Annual Summit in Scottsdale. The survey documents the size of program business and tracks various trends that shape the market. Since it was launched in 2011, the survey has documented the rapid growth of the program business from $17.5 billion in commercial insurance revenue in 2010, to $40.5 billion in 2018.
In addition to reporting on the continued growth of this insurance segment, the study tracked changes in views and practices related to insurance technology and cyber coverage. The 2019 poll also introduced the topic of inclusion and diversity.
The survey also noted an increase in the involvement of administrators with various forms of insurance technology. “An analysis of insurance technology indicates that administrators are keener to develop their own technologies as compared to their carrier counterparts who tend to rely on third party companies for insurtech,” the survey said.
Christopher Pesce, president of Maritime Program Group and president of TMPAA attributes this change to a combination of insurance technology maturing and more availability of insurtechs. “The program administrators are figuring out how to utilize insurtech,” he said. “The idea of insurtech is no longer an abstract concept for a program administrator, it’s now a necessity, and we fully expect to see the adoption rate of new technologies expand exponentially.”
The 2019 poll is the seventh in a series of annual surveys of program administrators and carriers to track trends in program business. Respondents to this year’s survey included 194 program administrators and 61 carriers. As with previous surveys, the research was conducted by the Association’s partner, Advisen.
Source: TMPAA