Excess and surplus lines wholesalers see a steady wave of growth in 2006
Excess and surplus lines experts expect to see steady premium growth in 2006, with commercial property and contractors business leading the way, according to an exclusive Insurance Journal survey.
Nearly 85% of survey respondents anticipate that their firm’s premium volume will grow in 2006, while only 5% expect it to decline; another 10% say their premium volume is likely to stay the same in 2006 compared to 2005.
A bare majority of brokers and wholesalers (44%) remain “very optimistic” about the stability of the E&S industry in 2006, while another 43% remain “optimistic.” Only 5% reported they feel either “pessimistic” or “not very pessimistic.”
Across the lines
Most brokers surveyed expect growth in commercial property (75%), general commercial liability (74%) and contractors (71%) over other E&S lines. Among those surveyed, more than two-thirds expect business growth in errors and omissions (69%); product liability (65%); non-medical professional liability (63%); employment practices liability (62%); transportation (63%); and commercial auto (62%) in 2006.
Just more than half of all respondents feel there will be growth in directors and officers (57%); architects and engineers (52%) and restaurant (51%) lines this year.
There is less optimism in some other lines. Less than half (49%) forecast growth in medical professional liability. Some cite coastal property (46%), health care industry (48%) and technology (48%) as growth areas. However, another 46% of respondents felt technology products would stay the same as last year.
Most respondents felt the following product lines would also stay the same as last year: residential property (51%), environmental (56%), workers’ compensation (49%), marine (65%), health care industry (48%), nonprofits (49%), farm and ranch (72%), oil and gas (52%), public entity (73%), financial institutions (73%) and sports and leisure (63%).
Nearly a quarter (23%) of respondents said their firms had total property/casualty premium volume in 2005 of $26 million to $50 million, and another 22% were from firms with total P/C premium volume of $11 million to $25 million.
More than 100 E&S brokers and wholesale firms replied to Insurance Journal’s online E&S Snapshot Survey in February 2006.
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