Five trends in the E&S market with Chris Lewis, President of Zurich E&S

This article is excepted from an article that first appeared in the August/September edition of E&S Insurer.

Q: What factors are driving the strong and consistent flow of business into the E&S market?

A: The E&S market continues to attract a strong and steady flow of submissions, and this isn’t just a short-term spike—it’s a reflection of how businesses are adapting to economic and political volatility. Many companies are facing complex risks or operating in industries where traditional insurance carriers are more cautious. The flexibility offered by the E&S sector, including customized terms and innovative coverage solutions, has positioned us as a vital resource for businesses that don’t fit the mold of the standard market. This increased reliance on E&S is amplified by ongoing global uncertainty, where companies want to know they have options for specialized risk management, no matter how turbulent the external environment might be. In essence, the E&S market’s strength lies in its ability to swiftly respond to emerging risks and offer tailored protection in dynamic conditions.

Q: How are developments in builder’s risk—particularly the difference between residential and commercial segments—shaping the E&S market?

A: Builder’s risk coverage is evolving as we navigate shifts in both the housing market and the wider economy. The slowdown in residential builder’s risk submissions reflects wider concerns about the strength of housing demand, rising interest rates, and supply chain issues. On the flip side, we’re seeing an increase in commercial builder’s risk, with larger and more complex construction projects turning to E&S for specialized coverage. Commercial projects often involve higher value, increased exposure, and unique requirements that can’t easily be addressed by admitted carriers. E&S insurers are able to structure solutions that keep pace with changing regulations and on-the-ground realities in construction and real estate development. This adaptability is becoming more critical as project profiles evolve, and it reinforces the role of E&S in providing comprehensive protection for both established and emerging risk areas within the construction industry.

Q: What is driving the rapid growth in casualty lines within the E&S sector?

A: Casualty lines are experiencing remarkable growth, a trend fueled by the rising severity of claims and an uptick in litigation activity. In today’s environment, companies face higher-than-average legal costs, settlements, and judgments, often due to shifting liability standards or increased involvement of third-party litigation funding. As a result, many risks are either leaving the admitted market or bypassing it altogether in favor of E&S solutions. The E&S market excels at designing policies to address these specific needs, such as tailored liability coverage and endorsements that respond directly to evolving exposures. Close collaboration between brokers and underwriters is essential, allowing coverage to be matched to current risk realities while maintaining long-term sustainability. At the same time, industry advocacy for tort reform and efforts to address litigation abuse are underway, all aimed at protecting customer affordability and preserving market stability as claim trends change.

Q: How is technology transforming E&S underwriting, accessibility, and client service?

A: Technology is dramatically enhancing both the efficiency and reach of the E&S market. Investments in digital underwriting and quoting platforms are reducing turnaround times, automating routine processes, and improving accuracy in risk assessment and pricing. These advancements mean brokers and clients can navigate submissions and obtain quotes faster, with less administrative friction than ever before. Additionally, digital platforms have made it feasible to offer E&S solutions to smaller businesses and niche sectors, which previously might have struggled to access tailored coverage. The use of advanced tools—including AI-powered analytics and automated workflow systems—ensures that underwriting remains both agile and informed, helping insurers respond quickly to changing risk dynamics. Ultimately, technology is not only driving productivity but also leveling the playing field for accounts of all sizes seeking coverage in the E&S market.

Q: How is consolidation in the retail brokerage sector affecting relationships and stability within the wholesale and E&S market?

A: The consolidation trend among retail brokers is having a meaningful impact on the E&S and wholesale landscape. As mid-sized and large retail agencies merge or expand, they build deeper, more strategic trading relationships with wholesale brokers. This shift encourages a more collaborative environment, where wholesalers and retailers can work together to develop solutions for complex and hard-to-place risks. Consolidation can also filter business more efficiently—ensuring that risks sent to the E&S market are genuinely challenging and need the specialized expertise that wholesalers and carriers provide. With fewer, but larger and more sophisticated retail agencies at the table, there is greater market stability, stronger partnerships, and a more resilient risk placement process. These trends are creating a more robust, interconnected channel that benefits both brokers and carriers, as well as the businesses seeking coverage.

Chris Lewis is President of Excess & Surplus (E&S) for Zurich North America. He is responsible for developing and executing E&S strategy and actions to best respond to the needs of customers and brokers, while helping Zurich better serve the E&S market and achieve growth in it.