AM Best: Surplus Lines Market Premium Moderates Through Nine Months of 2025

Why It Matters

The sustained outperformance of surplus lines signals continued demand for bespoke coverage, influencing underwriting strategies and profitability outlooks for both legacy and emerging insurers.

Key Takeaways

• Surplus lines premium grew 9.7% YoY through Q3 2025.
• Growth outpaced overall property‑casualty industry’s 5.5% increase significantly.
• Commercial property, auto, cyber, and professional liability drove growth.
• Top nine of ten surplus lines firms maintained market share.
• Newer hybrid carriers achieved double‑digit growth despite market moderation.

Summary

AM Best’s latest report shows that U.S. excess and surplus lines (ENS) premium growth moderated during the first three quarters of 2025, signaling the market’s transition from the rapid expansion seen in previous years.

Total ENS premium rose 9.7% year‑over‑year, down from 13.5% in the same period of 2024 but still well above the 5.5% growth recorded across the broader property‑casualty sector. The slowdown reflects easing rates in several lines, yet the market retained its lead over admitted carriers.

David Blades highlighted commercial property, commercial auto, cyber, and professional‑liability lines as the primary growth engines, while general non‑professional liability continued to generate the most premium. He noted that newer hybrid carriers posted double‑digit gains, whereas nine of the top ten legacy firms kept flat or single‑digit growth, and that volatility in personal lines—wildfires and severe storms—fed additional surplus‑lines demand.

The data suggests surplus lines will remain a key outlet for complex or high‑risk business that admitted markets shy away from, but investors should watch pricing discipline as newer entrants chase market share. For brokers and insurers, the trend underscores the importance of tailored solutions and vigilant profitability monitoring in a moderating environment.

Original Description

AM Best Associate Director David Blades discusses a new Best's Special Report that finds E&S premium market growth increased by 9.7% through the third quarter of 2025, down from 13.5% in 2024, reflecting the impact of competitive market pressures.

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