Non-admitted underwriters are seeking across-the-board rate hikes for property & casualty risks—and are covering more risks as standard lines insurers continue to shed unwanted business. Yet the surplus lines market has not entered the “hard” phase of the market cycle. Not even the massive insured property catastrophe losses stemming from Superstorm Sandy last fall could push the market into truly hard conditions.
Instead, insurers are taking measured steps to generate the revenue they believe they need to realize underwriting profits while not unnerving buyers with the jarring rate hikes and coverage restrictions that have marked some previous market turns. Even so, some risks face rougher market conditions than others, market executives note.
“It is interesting,” says Gary Tiepelman, senior vice president-contract underwriting at Scottsdale Insurance Co. of Scottsdale, Ariz. “It's certainly not a hard market, but it is a firming market.”
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