What’s Driving the Slowdown?
The line-of-business reports included in S&P GMI’s analysis reveal that the 15.4 percent jump in E&S premiums for commercial property and homeowners lines in 2024 marked the slowest pace of growth since 2018 (9.3%). In 2023, the E&S property growth rate had surged to 40.6%. In contrast, E&S liability premium growth, after slowing to 4.3% in 2023, returned to double-digit growth in 2024. The overall 2024 E&S liability growth rate was 12.4% across four lines (other liability-claims made, other liability-occurrence, medical professional and product liability)
Analyzing top players in the various lines, S&P GMI found that Berkshire Hathaway Group, the second biggest E&S property writer (behind STARR Cos.)—and the largest writer across all E&S lines—actually shrunk its E&S property premiums 1.5% to $4.0 billion across four property lines (fire, allied, commercial multi-peril/non-liability and homeowners) in 2024. Contributing to the decline, Berkshire’s E&S allied lines premiums fell by 17.1% to $1.5 billion, according to S&P GMI’s calculations. In contrast, in 2023, Berkshire’s E&S premiums for allied lines had soared by 66.4%.
Across all writers, homeowners, the smallest of the E&S property lines, saw outsized growth of 45.2% in 2024, rising to $3.2 billion from $2.2 billion in 2023. This jump was fueled by an 86% increase in California’s domestic E&S homeowners premiums, which climbed to $962.1 million.
Across all E&S property lines, geographies with significant exposures to hurricanes and wildfires reported the largest annual E&S growth rates last year, S&P GMI reported. Geographically, the S&P GMI analysis tracks the growth in each state’s share of E&S premiums relative to the total property market since 2019, finding changes of more than 10 percentage points in Hawaii, South Carolina and California.
Views of the 2025 E&S Property Market
Separately, at the S&P Global Ratings 41st Annual Insurance Conference in early June, specialty insurers writing commercial property on E&S paper discussed 2025 changes in the market, and their appetites for E&S commercial property risks.
Marc Adee, chair and chief executive officer of Crum & Forster Holdings Corp., highlighted recent market movement toward shared and layered business, which he said generally has broader terms and tends to be cheaper. The push to write this business occurred even after the January 2025 fires in California had “put a fair dent” in a lot of carriers’ results— when “a subdued approach to the market” would have been anticipated.
“The speed with which that market moved down might indicate that maybe some of the people that were moving the capacity from homeowners found something they liked better on the commercial lines side.”
“But that market moved hard and fast—and in a strange way,” he suggested, later encouraging investors and analysts at the conference to weigh what risk models are showing against how the market is moving. “The different versions of the models keep creeping up the return periods.” While modeled expected losses are trending in the upward direction, commercial property rates are going down.
“I would suggest that doesn’t make a lot of sense other than just there’s a lot of capital chasing, and not as much business as [carriers] might want.”
