Texas Achieves Record Premium in 2021

Jan 31, 2022 | eNews

The Stamping Office experienced record-breaking premiums throughout 2021, with over $9.1B premium reported. This results in a 14.9% increase over 2020. Year-to-date item counts reflect a small decrease (19 items), and policy counts reflect a decrease of 2.5%. Average premium per item increased 14.9% from $7,475 in 2020 to $8,587 in 2021. Non-Texas premium reflected a 9.2% increase, from $336.7M to $367.6M, while number of policies decreased 6.4% (from 2,955 to 2,766). Nearly three-quarters (74%) of policies have a premium of $5K or less.

Premium growth was evident in nearly all aspects of data reported, from policy stratification (by premium) through coverage/line of business and insurer, including non-Texas premium reporting.

The top 6 insurers are responsible for one-third (34%) of premium reported, with top 6 agencies placing a little less than half (43%) of premium.

Most lines of business experienced growth over 2020. The largest increase, Excess / Umbrella coverage, rose $289.5M or 21.0%. Additionally, Fire / Allied Lines coverage (residential, commercial, and historical codes) and Property Multi-Peril / Package (residential, commercial, and historical codes) coverages increased $162.6M (or 6.2%) and $134.8M (or 50.1%) respectively. 51% of total premium increases are attributed to these coverages.

Excluding pending (or rejected) filings, 57.9% of premium reported is attributed to renewal policies, which accounted for 37.5% of the filings. Additionally, 37.7% of premium (29.2% of items) reported is related to new business, and 4.4% of premium (33.3% of items) is a result of non-policy transactions such as endorsements, cancellations, audits, installments, etc.

The decrease in total transactions is equitable through various types of policies filed with SLTX; however, the largest decrease can be seen in the number of transactions (by type) submitted during the year. With the largest decrease attributed to renewals (down 9,804 items or 2.5% of the total), then new business (down 7,291 items or 2.4% of the total), and finally cancellations (down 7,114 or 7.6% of the total). The decrease cannot be attributed to reversals or record-keeping transactions. In fact, the largest increase in overall transactions is attributed to Name Change Endorsements (14,848 or 130.7% of the total).

With the hard market, premiums may continue to increase in 2022. SLTX will continue monitoring the Texas surplus lines market, as well as the national market, and share additional data as it is recorded, and analysis is completed.