E&S Property Rates Expected to Ease While Casualty Pricing Shows Mixed Trends

Property insurance policyholders using the excess and surplus (E&S) lines market are likely to see further rate decreases through the end of the year, while casualty rates remain varied, according to industry executives speaking at the Wholesale and Specialty Insurance Association’s annual conference.

E&S Market Activity

Submission flows into the E&S market remain strong, with growth expected to continue at a slower pace as buyers seek specialized coverage for hard-to-place risks. Increased insurer capacity and some property business moving back to admitted carriers have made the market more competitive.

“The market is in transition,” said Matt Dolan, president of North America specialty at Ironshore and executive vice president of Liberty Mutual’s global risk solutions business. “There are pockets of extreme softening. Certainly, E&S property is an example of that.”

Property Rate Trends

Modest property rate decreases are projected to persist, depending on the remainder of the hurricane season. Dolan noted that the market “has not found its floor yet.”

Kyle Burnett, senior vice president and head of E&S property for North America at Swiss Re Corporate Solutions, emphasized that rates are dropping but not in “freefall,” as carriers remain profitable. According to Burnett, rates are down 15% to 20% for loss-free, non-catastrophe-exposed business and down about 10% for catastrophe-exposed accounts. Loss-driven business remains flat or is seeing slight decreases.

Executives highlighted that some E&S premium flow may be shifting back to admitted property insurers as they regain capacity. Michael Garrison of The Hartford noted that wholesale producers report flat year-over-year flow and premium. Beazley’s Lindsay Shipper added that some non-catastrophe, loss-free accounts are returning to admitted markets, creating additional rate competition.

However, Shipper contrasted the current environment with the 2016–2017 soft market, when there was a significant shift back to the admitted market. Increased catastrophe losses — particularly more frequent convective storms and wildfires — are preventing a similar movement today.

Nationwide Insurance’s Tonya Courtney reported that the E&S market continues to grow at a double-digit rate. She observed that admitted carriers remain cautious about volatility, keeping many high-risk accounts within the E&S market.

Casualty Pricing Remains Variable

E&S casualty rates are influenced by ongoing “social inflation,” larger court awards, and litigation trends. Dolan explained that pricing depends on the line of business, with trucking and heavy fleet operations seeing modest rate increases, small manufacturing and small-to-medium enterprises holding flat to slightly higher rates, and lower-risk segments sometimes experiencing decreases.

Bill McElroy of Aspen Insurance highlighted tight market conditions for habitational real estate and certain construction classes. “There is no one casualty market,” he said, pointing to varying risk profiles and hazard rates.

Arthur J. Gallagher & Co.’s Ania Caruso noted competitive pricing in some areas but reduced capacity in others due to profitability concerns or pending litigation. She added that while primary rates remain more favorable for buyers, carriers are increasingly encouraging clients to take on more risk.

Sompo’s Sara Gundersen emphasized that claims severity remains a challenge. “There’s no safe attachment point when you’re thinking about excess anymore,” she said, underlining the need for disciplined underwriting.

Technology and Efficiency

E&S insurers and wholesale brokers are investing in technology to manage high submission volumes and improve risk assessment. Nicole Perrault of Vantage Risk said automation helps insurers run lean operations, allowing more resources for profitability.

Lisa Davis of Canopius described a shift from manual processes to a policy administration system and the use of an AI underwriting platform from Kalepa to process submissions more efficiently. Garrison added that property underwriters can now review submissions with valuations and modeling already completed, reducing review times from hours to minutes.

Industry executives report that E&S property rates are softening, with modest decreases anticipated through year-end, while casualty pricing varies by risk and class. Advances in technology are enhancing underwriting efficiency as the market adapts to changing conditions.