Morgan Stanley highlights growth potential in excess & surplus insurance markets

From Investing.com: 2024-12-05 14:30:20

Morgan Stanley initiates coverage on Kinsale Capital Group Inc, Ryan Specialty Group Holdings Inc, and Brown & Brown Inc with an “overweight” rating, highlighting their strong underwriting discipline and pricing power in the excess and surplus insurance market.

The E&S insurance market is expected to benefit from favorable pricing trends, supported by a positive macroeconomic environment projected to extend through 2025 and beyond.

Insurers are increasingly turning to the E&S market for flexibility in pricing and terms, especially in states where they are reducing exposure to the admitted market due to rising loss costs, social inflation, and natural disaster risks.

As major insurers retreat from high-risk regions, E&S insurers are better positioned to adapt and capitalize on their pricing autonomy to address heightened risks, leading to a shift in the overall insurance industry landscape.

Morgan Stanley’s report highlights the structural growth potential in the E&S market, emphasizing the importance of a disciplined underwriting approach and the ability to leverage favorable pricing trends for companies looking to benefit from the evolving risk environment.



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