People struggling to get property insurance from traditional insurers are increasingly turning to riskier specialty insurers, a new research paper says.
Worsening extreme weather events and inflation have led many large property insurers to retrench in disaster-prone states, renewing fewer customers and sharply hiking premiums for the ones they keep.
That’s created space for a small segment of the industry that lacks certain financial protections for policyholders.
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Last year, these so-called surplus-lines insurers wrote 1.9 percent of homeowners’ premiums in the U.S., more than double the 0.8 percent they wrote in 2014, credit ratings agency AM Best says in a new report that projects continued growth.
