Dellwood Insurance Group

Aug 12, 2025

Once the "market of last resort," E&S is now becoming a core placement option Share The US excess and surplus (E&S) market has been on an extraordinary growth trajectory in recent years, reshaping the competitive landscape for insurers and brokers alike. Driven by a combination of market dislocation, emerging risks, and the flexibility of the non-admitted market, E&S has evolved from a “last resort” option to a core part of risk placement strategies. Industry leaders say that while the pace of growth will normalize, the structural shift into E&S is here to stay, and brokers must adapt to capitalize on the opportunities. Flexibility and expertise: The strengths of E&S For Kyle Burnett (pictured below), head of E&S property at Swiss Re Corporate Solutions, the turning point was a string of catastrophe events that exposed weaknesses in the admitted market’s ability to respond quickly. “We had the Fairview River and Marina hurricanes come through, followed by a string of storms making landfall in 2018, 2019, 2020, 2021, and 2022,” Burnett said. “They hit different parts of the country, and that was really a catalyst for the insurance market,  especially property, to start hardening.” Combined with wildfire losses, flash flooding, rising loss costs, and social inflation, the conditions created what Burnett called a “perfect opportunity” for E&S to prove its agility under pressure. “We’re no longer just a market of last resort,” Burnett said. “We’re now an essential piece of the future. Michael Price (pictured below), CEO of Dellwood Insurance Group, an E&S lines insurance holding company serving wholesale brokers and program administrators, points to another structural advantage: the freedom of rate and form. “Admitted markets have difficulty keeping up with rate and coverage demands when they have to work through 50 different insurance commissioners,” Price said. “The trend toward E&S follows carriers’ desire to maintain flexibility in an uncertain loss-cost environment.” Both leaders agree the growth is sustainable, though the surge of recent years will temper. Price notes that submission flow into E&S remains at double-digit growth rates, but micro-cycles between property, casualty, and professional lines will affect volume. Burnett expects momentum to normalize but says discipline will cement E&S as a permanent fixture. “The structural shifts we’ve seen have shown discipline, and E&S will continue to have a permanent role,” he said. Areas of opportunity in E&S Geography is emerging as a key growth lever. Burnett sees untapped potential east of what has traditionally been Tornado Alley, where convective storms are increasingly frequent. “This shift has raised concerns for homeowners in areas that previously didn’t consider themselves high-risk,” he said. Price points to smaller property accounts, i.e. those with total insured values under $25 million, as another opportunity. “They’re more insulated from intense competition because they require more infrastructure to handle efficiently,” he explained. Larger shared and layered accounts, by contrast, are seeing sharper rate declines as capacity floods in. For now, both executives see an abundance of capacity in property, fueled by a slowdown in major hurricane landfalls in 2023 and 2024, and Lloyd’s reemergence in the space. “There’s ample capacity chasing business, which is shaping some of the dynamics we’re seeing,” Price said. Burnett cautioned that while competition is healthy, capacity can exit quickly amid a softening period in the property market. Despite this, secondary perils will continue to drive E&S relevance across lines. “These are conditions E&S can respond to quickly, and they’ll keep us as a staple of the insurance market,” said Burnett. On the other hand, the E&S market’s role in casualty lines has grown as social inflation and litigation trends push complex risks out of the admitted market. “Loss trends in casualty remain elevated, and we believe they will for the foreseeable future,” Price said. “For underwriting teams that are selective and disciplined on pricing, there’s real opportunity to grow profitably.” Underwriting discipline in a competitive market Both leaders emphasized that disciplined underwriting remains the foundation for sustainable growth in E&S. “At Swiss Re, we stick to a clear, consistent approach,” Burnett said. “We educate our underwriters, understand the perils and occupancies we write, and are deliberate about attachment points. That consistency keeps us a reliable partner for clients.” Price echoed the point, noting that a strong underwriting company must manage each line’s cycle individually. “E&S is a composition of property, casualty, and professional lines, each with its own cyclical behavior,” said Price. “The job is to find the pockets of profitable growth where capacity is less abundant.” If Burnett had to sum up the future of E&S property in a word, it would be growth. “The E&S property market is well-positioned to adapt to shifting risks,” he said. “That long-term demand is being driven by complexity, volatility, and gaps left in the admitted market. “Continued growth will depend on disciplined underwriting and smart use of risk technology, but our agility gives us a strong advantage.” Price sees similar potential but warns against treating E&S as a monolith. “Don’t think about E&S in totality,” he advised. “Understand the different cycles within each line and position accordingly.” How brokers can leverage growth in the E&S space For brokers, the shifting market demands deeper expertise and stronger wholesale partnerships. “Expertise in E&S is consolidating into a handful of top wholesale brokers,” Price said. “The challenge is to understand the resilience and strength of the wholesale market, especially if there’s a swing back toward admitted carriers. “The E&S space has always been here to solve complex risks. Over the last five or six years, we’ve seen significant inflow because of the expertise our wholesale partners bring and the relationships they have with carriers. Those relationships will continue to be the foundation of success in this market.” Burnett agrees that brokers who understand evolving perils, regional trends, and capacity dynamics will be best positioned to add value. While his outlook is optimistic, he said increased competition is something brokers should monitor. “The market’s done a good job of maintaining discipline so far, and that’s critical for clients,” said Burnett. “We don’t want big swings in pricing or terms. Clients should know what to expect so they can budget appropriately. For us, the focus is always on consistent, disciplined execution day-to-day.” Related Stories