The US excess and surplus market (E&S) market continues to grow at a robust rate; however, the yearly pace of growth has slowed, according to an analysis by S&P Global Market Intelligence.
For the fifth year in a row, E&S premiums have grown by at least double digits, but the yearly rate of growth peaked in 2021 at 32.3% and has fallen to 20.1% and 14.5% in 2022 and 2023, respectively. For full-year 2023, the US E&S direct premiums written were $86.47 billion, compared to $75.51 billion in 2022. The bulk of E&S premiums in 2023 were written within various casualty or liability coverages (52.5%), several property lines of business (31.7%) and commercial auto (5.4%).
E&S premiums constituted 9.2% of the country’s total direct premiums written in 2023, compared to 8.8% in the prior year. A softening in market conditions in some of the most significant E&S business lines could lead to a further slowdown in market share gains in 2024. During a hard commercial insurance market between 2001 and 2006, the share of E&S premiums maxed out at 6.7% of the property and casualty market in 2003. After the early 2000s hard market, the yearly share of E&S premiums against the total US property and casualty market were in the 5% range until 2019.
The largest individual writer of E&S business in 2023 was Berkshire with its reported $8.39 billion in direct premiums, followed by AIG and Fairfax Financial with $4.96 billion and $4.04 billion, respectively.
Clients can access the full 2024 E&S report, including market share templates on S&P Capital IQ Pro.