DUAE Growth Expected to Moderate; Outlook Stable: AM Best

AM Best is maintaining its stable outlook for the delegated underwriting authority enterprise (DUAE) segment, citing continued premium growth, strong demand for specialty expertise and technology, and a growing emphasis on underwriting discipline and governance.

The segment recorded its fifth consecutive year of double-digit premium growth in 2025, outpacing the broader property/casualty industry. However, AM Best expects growth to moderate as carriers become more selective about capacity deployment and increasingly prioritize profitability over premium expansion.

Regulatory scrutiny is increasing, with greater emphasis on underwriting quality, transparency, internal controls and reliable reporting. Carriers are intensifying reviews of delegated underwriting authority, claims handling and data integrity.

In its latest market segment outlook, AM Best said delegated underwriting businesses are important strategic partners for capacity providers, particularly in emerging risks, specialty lines and technology-driven platforms. At the same time, the competitive landscape is changing as traditional insurers face competition from alternative capital, insurance-linked securities and private equity investment.

AM Best noted that mergers and acquisitions are likely to continue, with smaller and less-differentiated players potentially becoming acquisition targets.

AM Best said the market is shifting from rapid expansion toward more measured, quality-focused growth, with long-term success increasingly dependent on disciplined underwriting, operational maturity and strong governance.