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Surplus lines market hits new premium record amid industry challenges

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Surplus lines market hits new premium record amid industry challenges | Insurance Business America















New report shows E&S business booming

Surplus lines market hits new premium record amid industry challenges


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The U.S. surplus lines insurance market reached a significant milestone in 2023, surpassing $100 billion in premiums for the first time and recording over $115 billion in direct premiums, according to a new report by AM Best in collaboration with the Wholesale & Specialty Insurance Association (WSIA). This represents a robust 16.8% growth over the previous year, marking six consecutive years of double-digit expansion.

Additional drivers of growth include higher pricing for certain types of coverage and a surge in submissions from wholesalers and managing general agents (MGAs). Non-admitted carriers have been particularly adept at crafting policies for emerging risks, including those related to climate change and cybersecurity, underscoring the sector’s evolving role.

The surplus lines sector’s growing role as a “safety valve” for the property and casualty (P/C) insurance industry is increasingly vital. It continues to provide customized solutions for high-risk exposures that standard markets shy away from, reinforcing its importance in the industry.

This premium surge reflects a larger trend: surplus lines are capturing a growing share of the P/C market. In 2023, surplus lines accounted for 23.7% of the total commercial lines direct premiums written in the U.S., up from just 7.1% in 2000.

Looking ahead, the report suggests that surplus lines insurers are well-positioned for continued expansion, especially as new risks and coverage needs arise in response to rapid technological and environmental changes.

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