The surplus lines segment grew its direct written premium by 6.7% in 2014 to $40.2 billion, a record for the sector. And 2015 is set to break that record, with a first-half 9.5% increase over the same period in 2014, according to A.M. Best’s 2014 Special Report U.S. Surplus Lines, Segment Review.
Want more good news? The surplus lines industry grew its direct written premium 27% between 2010 and 2014 (California was up 40%!). Additionally, the average combined ratio for surplus lines specialists was 91.4 for 2014, notably better than the 97.2 registered for the property/casualty industry at large that year, A.M. Best says.
Are you keeping up with those averages? If not, it’s time to look at your processes and systems to see if they are holding you back.
What’s driving all that gain? According to A.M. Best, it’s a combination of product diversification, disciplined underwriting and good market conditions. Included in the market and product influences are innovative new companies, like transportation network companies, e-cigarettes, medical marijuana growers and distributors, and drones, to name a few. Better use of predictive modeling and big data are also starting to influence underwriting, and government regulations regarding cyber security, for example, are pushing insurers, program administrators and MGAs, as well as private and public companies and enterprises, to become more creative in securing and insuring data.
The key in surplus lines has been to specialize, customize coverage and be disciplined in underwriting. As manufacturers, financial services companies, healthcare providers and others become more complex in their offerings, program insurers and surplus lines insurers have had to keep up, both in products and in expertise.
But your business prospects could be walking down the street to the competition if you don’t have swift, accurate, easy-to-use systems, even if your products and expertise are spot on. At NetRate, our core business is the program business segment, and we specialize at making sure our clients don’t have to waste time or dial back customers because of laborious manual entries and errors, slow turnaround or flimsy data.
At NetRate, our automated rating solutions use an ISO-based system with a full line of rating modules covering all 50 states and the District of Columbia across numerous lines of commercial insurance business. And we can customize our software to work with insurer databases as well as ISO data.
What’s better is that our end-to-end commercial lines rating system can be implemented in multiple ways, including both Windows and Web-based programs. Our insurance quoting software features customized user interface, standard PDF worksheet outputs, ISO Stat Code generation, DMV report data aggregation, policy document production and a host of other services designed to make your quote-to-bind process seamless and dependable.
To meet or beat the record growth in the industry, you need systems that are as smart and reliable as your team.
NetRate can help make your rating and associated business processes more efficient and enhance your competitiveness while keeping your unique needs at the center of the system. Please give us a call at (877) 790-1114 or email us to find out how NetRate can provide you with solutions to improve your commercial lines insurance rating process.
Source: Insurance Journal