Surety Market Performing Well, But Troubles Still Loom Ahead

Posted by Jeffrey Carey and Charles Teter on May 11, 2012 under Risk Management, Surety | Be the First to Comment

The preliminary 2011 surety industry results once again shattered many of the “crystal ball” predictions, as significant surety losses failed to materialize.  On the surface, the recent meetings between Lockton’s National Surety Team and top industry executives left the Lockton team with a case of déjà vu.

Excellent financial results paired with predictions for a monsoon of losses on the horizon was a familiar theme.  While one could overlook the predictions because of continued positive financial results and reviewing historical information will bring new points of concern to the surface.

Overall, industry results were fabulous: $5,139,092,292 in written premiums, $671,681,201 in direct losses, and a 13 percent direct loss ratio in 2011.  Several sureties generated record profits, capacity has never been more abundant, and sureties are hungry to write well-qualified credit / contractors.

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Co-Authors Spotlight

Jeffrey Carey

MBA, CPCU, AFSB, CRIS
Assistant Vice President

Jeff Carey has been with Lockton since 2003, he is a construction and surety specialist focused on special projects and establishing and maintaining client and carrier relationships.

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Charles Teter

MBA, AFSB
Vice President, Unit Manager

Chuck Teter is vice president and unit manager of Construction Operations, he coordinates contract surety bond placement with the markets and acts as client liaison and advisor on all contract surety matters.

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