A.M. BestTV: Infrastructure Boom Would Aid Many Smaller Surety Writers, Say A.M. Best Senior Analysts

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)-- In this ^A.M.BestTV episode, A.M. Best’s Senior Financial Analyst Robert Valenta and Senior Research Analyst David Blades review a new report that examines the growth of the U.S. surety insurance segment and the forces shaping it. Click on http://www.ambest.com/v.asp?v=surety218 to view the entire program.

Bolstered by strong construction activity, surety underwriters continue to benefit from consistent premium growth and strong levels of underwriting income.

“Underwriters of surety coverage have been producing favorable results over the past decade,” said Blades. “Not only has premium growth been achieved, but despite pretty heavy market competition, underwriting income also has consistently been produced during the same time frame. The post-recession economic recovery, which has positively impacted the construction industry, has been a driver of the premium growth for the surety market in that the construction industry is the main source of business for surety writers,” continued Blades.

The report states that the 2017 premium level is on track to surpass the $6 billion mark for the first time this decade. Valenta believes that competition has played a role in creating this premium level.

“Profitability within the sector has added a lot of new entrants, which has really increased the capacity as well as heightened the level of competitiveness and created a continuation of soft market conditions. Generally, profitability within the top carriers is better than the entire industry, and this is mainly due to increased scale, niche market expertise and strong relationships with agents and brokers,” said Valenta.

To access a copy of this special report, titled, “Expected U.S. Infrastructure Boom Poses Benefits, Risks to Surety Sector,” please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=269584.

Recent episodes of ^A.M.BestTV include:

Surging Life Sector Boosts Insurance Growth in China, Says A.M. Best Senior Financial Analyst: A.M. Best Senior Financial Analyst Vivian Cheung says that China’s insurance industry is expected to continue its growth, with new rules on short-term life products and growth in non-motor property insurance aiding the market momentum: http://www.ambest.com/v.asp?v=cheung118.
U.S. Life/Annuity Insurers Step Up Use of Reinsurance, Says A.M. Best Director: William Pargeans, director, A.M. Best, reviews a new report that details how life and annuity insurers are using reinsurance for overall risk management, coverage of specific risks, supporting new products and more: http://www.ambest.com/v.asp?v=laparjeans118.
How U.S. Tax Reform Will Affect Insurers: A.M. Best Senior Industry Research Analysts George Hansen and David Blades examine how the 2017 U.S. tax reform is set to impact a wide range of insurance areas, including reinsurance, reserves, long-tail lines and more: http://www.ambest.com/v.asp?v=taxreform118.
Record California Wildfire Season Puts Spotlight on Insurers: A.M. Best Financial Analyst Lewis DeLosa and Industry Analyst Bobby Skrabal examine the impact of recent catastrophic wildfires in California, including how these fires might affect insurance underwriting, modeling and reinsurance: http://www.ambest.com/v.asp?v=wildfires118.

^A.M.BestTV covers exclusive A.M. Best information and reports, targeted topics and key developments in the (re)insurance industry every Monday, Wednesday and Friday. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View ^A.M.BestTV episodes at http://www.ambest.tv.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.