Insurers boosting E&S investments

SAN DIEGO — Insurers are ramping up their investments in the excess and surplus lines market as premium growth remains strong and demand rises for coverage of hard-to-place risks.

Axa XL has launched a standalone wholesale E&S facility, spearheaded by Lucy Pilko, CEO Americas, Tim Whisler, head of the insurer’s wholesale business in the Americas, said in an interview Tuesday at the Wholesale & Specialty Insurance Association annual conference in San Diego.

“It’s a distinct vertical within the company where the underwriters only work on E&S business with a distribution strategy that’s 100% wholesale only,” Mr. Whisler said.

Right now the E&S business is written by Axa XL unit Indian Harbor Insurance. “We are in the process of standing up a new legal entity so that we’ll write on different paper going forward,” he said. “The idea in the future is that our E&S division will be writing on distinct and separate paper from the retail division.”

The new vertical has around 45 underwriters and is adding more daily, Mr. Whisler said.

The predominant focus is on property and casualty risks, and that will broaden, he said. Property and casualty limits of around $5 million are available.

The E&S market grew from $50 billion in premium in 2018 to $135 billion in 2024, and some reports suggest it could reach $147 billion this year, he said.

“The market opportunity, the impressiveness of the E&S market is real. It also has tremendous staying power,” he said.

Axa XL has been in E&S for a while, but “there’s really a good market opportunity for us to do it in a different way and capitalize on the growth of the market,” Mr. Whisler said.

More mid-market business is coming into the E&S market, said Erich Bublitz, head of AmTrust E&S.

AmTrust Financial Services has expanded into new product lines including property, environmental and social services and expects to add builders risk later this year, Mr. Bublitz said in an interview.

AmTrust last week announced the launch of E&S Premier, a group focused on complex casualty business within its E&S division.

On Monday, AmTrust announced it is expanding its excess and surplus division by consolidating its primary, excess and environmental products into a new brokerage casualty group.

“We’re not chasing a market opportunity right now as much as saying we believe in the E&S market. We believe there’s great potential across the platform for E&S,” Mr. Bublitz said.

Meanwhile, Specialty Program Group, the specialty broking and underwriting unit of Hub International, announced Monday that it is consolidating its wholesale business under one name.

Last year Everest Group rebranded its U.S. excess and surplus lines unit as Everest Evolution, and CNA Financial launched Cardinal E&S, a brand dedicated to the excess and surplus lines market.