US E&S Growth Slower in 2023; Berkshire, AIG Top Premium Rankings
An analysis by S&P Global Market Intelligence reveals that the pace of growth in the U.S. excess and surplus lines market has slowed since a peak growth rate of 32.3% recorded in 2021.
In 2023, growth remained robust—and up in double digits—but fell to 14.5%, down from 20.1% in 2022 and the 32-plus percent rate recorded in 2021.
Still, it’s the fifth straight year of double-digit growth, S&P GMI said in its 2024 U.S. Excess & Surplus Market report, which also shows changes in E&S market share and growth rates for each of the last 20 years, lists the top 25 E&S writers in 2023, and delivers information on leaders (top 10) and E&S market share by line and state.
For full-year 2023, the U.S. E&S direct premiums written were $86.5 billion, compared to $75.5 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 represented 9.2% of the U.S. total direct premiums written in 2023.
Across all lines and states, Berkshire Hathaway Group tops S&P GMI’s ranking of E&S writers based on U.S. E&S direct premiums written for 2023, with Berkshire’s $8.4 billion eclipsing AIG at $5.0 billion and Fairfax with $4.0 billion. (Editor’s Note: S&P GMI’s U.S. E&S ranking does not include Lloyd’s.)
Berkshire’s E&S premiums grew by 21.2% in 2023, and the report shows that much of that growth came from four property lines—fire, allied, commercial multiple peril and homeowners. The group wrote $4.0 billion of its total $8.4 billion of E&S premium in those lines, and Berkshire was a top-three writer in 2023 in each of the lines, with growth rates like 55.9% in fire and 66.4% in allied lines.
Several lower-ranking groups grew faster than Berkshire, including Starr Cos., ranked eighth on S&P GMI’s overall U.S. E&S ranking with $2.7 billion in premiums and a 48.8% growth rate across all lines. Starr also topped the ranking for the fire line, with an 82.3% growth rate recorded in 2023 for that single property line.
In total, E&S writers garnered a 40.6% share of the fire market in 2023—a market share figure that compares to just 24.1% a decade earlier in 2013. E&S market share across all property lines was 11.1% in 2023 (with the industry still writing 98.6% of the homeowners line on an admitted basis).
For liability lines, E&S market share was 34.9% in 2023, compared to 23.8% in 2022.
In contrast to the property lines, the 10 groups ranked as the largest writers of other liability-claims made policies on a nonadmitted basis all reported year-over-year declines in 2023, including top-ranked Berkshire with a 38.8% drop in E&S direct premiums written for the line during 2023.
Berkshire. W.R. Berkley, Fairfax Financial and Chubb each ranked as top-10 E&S underwriters in four individual liability business lines—other liability-occurrence, other liability-claims made, medical professional and product liability. W.R. Berkley, with over $2 billion of its $3.6 billion of total E&S premiums written in other liability-occurrence, was the highest-ranked writer of that line of business, recording 19.3% growth in the line during 2023.
Across all lines, other top-25 E&S players writing lower E&S premium volumes but recording growth rates above 40% were Kinsale (overall rank 13), Starstone and Travelers.
S&P GMI’s Methodology
The S&P GMI E&S report is derived from data running the S&P Global Market Intelligence E&S market share templates, P&C – Market Share (All exhibits) and P&C – Market Share (E&S Lines), the report notes in an introduction explaining the methodology.
Template results are based on U.S.-domiciled entities that submit regulatory statements to the National Association of Insurance Commissioners and excludes so-called alien surplus lines insurers that are domiciled outside the U.S. but write domestic business, including certain Lloyd’s of London syndicates.
According to S&P GMI, the data is derived from Schedule T of annual and quarterly statutory statements for individual entities to identify those companies that list their status as “not licensed,” “eligible surplus lines” or “domestic surplus lines insurer.”
The data was compiled on April 20, 2024.