While the excess-and-surplus-lines sector is maintaining good profitability and strong balance sheets, challenges from high catastrophe exposures and low interest rates remain, says a report from Moody's Investors Service.
“Collectively, E&S companies reported an underwriting loss in 2011 due to the high level of catastrophes,” says the report, citing last year's earthquakes, tsunamis, floods and severe storms.
But Moody's says that even with current challenges, E&S insurers are expected to continue to generate top-line growth through product innovation and development.
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