It's good to be in the E&S market right now. Indeed, E&S typically fares well during cycles when the standard market is challenged, and currently, with loss trends, social inflation, high jury verdicts and severe weather events, it's safe to say that the P&C industry has certainly been challenged.
The economic uncertainty stemming from the pandemic has only been a boon to the E&S market, with total surplus lines premiums hitting $41.7 billion for calendar year 2020, a 14.9% increase over 2019. The first six months of 2021 were similar: Surplus lines premiums exceeded $24 billion through the first half of 2021, a 21.9% increase over the same period in 2020. Source: WSIA 2021 Midyear Report
It's a market ripe for new players, and E&S startups are emerging to get in on the action by offering fast-growth coverage lines like residential and commercial construction, excess liability, commercial property, management liability, and cyber liability.
Surplus Lines Premium Growth (2019 - 2020)
2019: $19,723,624,417
2020: $41,701,099,641 Reported to 15 stamping offices. Source: WSIA.
Surplus Lines Premium Growth (1H 2020 - 2021)
1H2020: $24,039,089,547
1H2021: $36,283,382,478 Reported to 15 stamping offices. Source: WSIA.
Regardless of which category they fall into, these game-changers have a common North Star: to differentiate themselves by getting their unique products to market faster and servicing their customers in a way that best meets their needs.
OneShield's SaaS product is hosted in a secure, cloud-based environment, and the automated, end-to-end policy management functionality usually appeals to E&S startups. As a configurable solution, it allows for flexibility where needed for company differentiation, or as business needs inevitably change. And she says that as a full SaaS, OneShield takes over implementation and system management, and effectively becomes the startup's IT team. Couple that value with an attractive 'all-in-one' pricing model, and the large upfront investment or future technology debt is eliminated for cash-strapped startups.
If the past few years have taught us anything, it's that insurance risk is always increasing and the pace of change is relentless. Against this backdrop, E&S startups have a great opportunity, but only if they have the infrastructure to support it. Savvy E&S startups will invest in technology now so they can go the distance.
OneShield provides business solutions for P&C insurers and MGAs of all sizes. OneShield's SaaS platforms include enterprise-level policy management, billing, claims, rating, relationship management, product configuration, business intelligence, and smart analytics.