US E&S insurance market poised to maintain upward trajectory, says Conning

The Excess and Surplus (E&S) insurance market has experienced significant growth, achieving a 21% compound annual growth rate over the past five years, surpassing $104 billion in premiums in 2023, and is expected to continue its upward trajectory, according to a report by Conning.

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Lauryn Kothavale, Vice President of Insurance Research at Conning, stated, “The E&S insurance market continues to exemplify resilience and innovation, navigating both cyclical and structural challenges with agility.”

She added, “Looking ahead, the growing demand for tailored coverage solutions highlights the sector’s indispensable role in mitigating complex and evolving risks.”

The report highlighted that the E&S market’s growth has been driven by rising demand for tailored insurance solutions. Since 2017, an influx of new entrants has reinforced the sector’s capacity to meet these needs, demonstrating strong demand for its offerings. The market’s ability to deliver bespoke coverage aligns with current trends, as policyholders increasingly seek solutions tailored to address evolving risks.

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Despite this growth, the market has faced challenges, including increased natural disasters and rising settlement costs between 2017 and 2023, which have led to heightened liability claims and volatility in underwriting performance.

Looking ahead, Conning anticipates continued growth for the E&S market. Flexible regulatory frameworks and technological advancements, such as artificial intelligence, are enhancing insurers’ ability to develop more precise risk assessments and policy solutions. These innovations, combined with the ongoing demand for bespoke insurance products, are expected to sustain the market’s momentum and resilience.