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In the February issue of Florida Underwriter, we published an extensive Q&A with three insurance executives who focus on excess and surplus lines: Michael Franzese, CPCU, CIC, CRM, ASLI, CPA, vice president with Burns & Wilcox in Tampa; Ron Gabor, president of Gabor Insurance Services, Inc., in Miami; and Irvin “Skip” Wolf III, a senior vice president at Regional Excess Underwriters, LLC, in Jacksonville. That conversation dealt primarily with legislative issues, and we promised a follow-up dialog on market cycles, capacity, emerging coverages, and the impact of the standard market. We are pleased to continue the  conversation in this Florida Surplus Lines Association E&S supplement.

Instead of the traditional cycle — a hard market followed in relatively short time by a soft market — it appears that we are caught in a long-term soft market. Do you think this is the “new normal?”Franzese: When I started in the business in 1985, we were in the midst of my first and only hard casualty market. That lasted only about 18-24 months. With the exception of a few specific classes of business like residential home building and long haul trucking, there really has not been a hard casualty market since. When the casualty hard market ended in 1986–87, we had a prolonged soft market until Hurricane Andrew. That hard property market seemed to only last a year or so. The next catastrophic event was obviously 9/11. This created a specific type of hard market as carriers started becoming concerned with terrorist threats. Then came the eight hurricanes of 2004 and 2005. The property marketplace firmed up dramatically for about a year, but things started to ease quickly.

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