Surplus lines writings of $7.92 billion in Texas for 2020 represent a 13.98 percent increase compared with 2019, making it the highest year of surplus lines premium in Texas history, according to the Surplus Lines Stamping Office of Texas (SLTX). Each month of 2020, except July, said SLTX in a news release, set a new record high for that month. Policy count, however, was down for the year by 3.34 percent.

Annual excess and surplus lines premium in Texas has had steady growth since 2016, when total premium was $5.12 billion. In 2017, E&S premium processed by SLTX was $5.46 billion; in 2018, $6.08 billion, and in 2019, $6.95 billion.

The large percentage growth for the year does not come as a surprise, given that every quarter this year showed double digit percentage growth over the prior year-to-date results, a growth rate that repeats last year’s.

SLTX’s Executive Director Greg Brandon said, “December premium was up substantially versus prior years, but that has been a common theme for 11 of the 12 months in 2020.” Brandon continued that it is hard to say that any particular line of coverage stood out, as the rising tide of premium seems to have floated across all lines of coverage.

Fire (including Allied Lines), the second largest coverage in surplus lines, sustained more than 20 percent growth in year-over-year results at the end of every quarter of 2020, a continuation of the growth since 2018. Other liability, the largest coverage in surplus lines, ended 2020 shy of the double digit percentage growth at 9.10 percent. Together, at year end 2020, these two major lines made up 76.91 percent of all taxable surplus lines premium reported to SLTX.

There was a decrease of about $15.7 million in multi-state premium reported to SLTX for 2020, compared with 2019, even though multi-state policy count was up by 8.96 percent. Multi-state premium decreased 4.45 percent, as brokers reported $336.7 million in premium for multi-state risks, compared with $352.4 million in 2019. Multi-state premium made up 4.25 percent of 2020 taxable surplus lines premium, down from 5.07 percent in 2019; 5.77 percent in 2018, and 7.42 percent reported in 2017. Multi-state policy count for 2020 was 2,955, compared with 2,712 filed in 2019. Average premium on multi-state policies was $113,951.

There were 717,103 policy filings received by SLTX in 2020, compared with 741,920 policies filed in 2019. Average premium per policy was $11,050, which is 17.93 percent greater than the 2019 average per policy of $9,370.

Premium growth far outpaced the policy count in SLTX submissions, as policy count reported by SLTX declined by 3.34 percent. Policy counts by line reported by SLTX include some double counting; when SLTX receives multiline policies, it splits the premium among the applicable lines. SLTX reported that its policy filings counted by line totaled 736,022 in 2020, a 2.18 percent decline from 2019 which had 754,443 policy filings counted by line.

The largest increase in the number of policies filed was in Allied Lines, which was up by 7,870 policy filings, pushing the line’s policy count up by 25.42 percent over 2019’s. There were 134,151 policy filings in Fire (including Allied Lines) in 2020, versus 141,581 filed in 2019, a 5.25 percent decrease despite a 23.55 percent premium growth in the line.

Along with Fire (including Allied Lines) showing a premium increase despite a decrease in policy count were Commercial Multiple Peril, Aircraft and Credit.

In all, total premium in 14 of the 24 lines of business reported to SLTX in 2020 was up compared with last year. The lines of business that showed the greatest dollar growth were Fire (including Allied Lines), which was up $507.27 million, or 23.55 percent, compared with 2019; Other Liability, which was up $286.31 million, or 9.10 percent.

The largest line, Other Liability, is reported in 16 subcategories, of which half were up and half were down in premium reported. Within Other Liability, the coverages showing the greatest dollar growth were Excess/Umbrella, which increased by nearly $209.57 million, or 17.90 percent, and GL Contingency Liability, which increased by nearly $71.01 million, or 114.58 percent and represented the largest percentage growth within the Other Liability line. Also showing multimillion dollar gains within the Other Liability line were GL-Premises Liability Commercial, up $45.15 million, or 4.28 percent; Professional D&O, up $18.59 million, or 52.50 percent; GL-Pollution, up $11.25 million, or 6.14 percent, and GL-Cyber Liability, up $6.48 million, or 5.10 percent.


Leading the declining eight subcategories within the Other Liability line was Oil and Gas Liability, which was down $43.12 million, or 48.68 percent. The next largest dollar decline was in Professional Other (including E&O), down $18.79 million, or 5.02 percent. Other multi-million declines were in GL-Contractual, down $7.77 million, or 84.74 percent; GL-Liquor, down $3.02 million, or 21.22 percent, and Employers Liability, down $2.51 million, or 46.03 percent. Continuing downward from last year GL-OCP, down $0.78 million, or 26.51 percent; and GL-Terrorism, down $0.63 million, or 15.19 percent. Not unexpectedly due to COVID-19 restrictions, Special Events Liability was down, $1.02 million, or 46.97 percent.

Fire (including Allied Lines) is reported in three subcategories: Property Fire, Property Fire/Allied Lines, and Oil and Gas Property, with Property Fire reporting zero premium in 2020 and Oil and Gas Property showing a decline in premium for 2020. Oil and Gas Property was down by $6.90 million in premium, or 19.90 percent. This decline was more than offset by gains in Property Fire/Allied Lines, which was up by $514.16 million, or 24.26 percent.

In addition to the strong results in these major lines, other lines showed both multimillion dollar and double digit or more percentage increases. Other Commercial Auto Liability was up $92.91 million, or 42.57 percent; Allied Lines, up $88.84 million, or 54.56 percent, and Earthquake, up $2.83 million, or 120.65 percent.

Medical Malpractice was up in 2020 but at a slower pace than last year. Med Mal premium increased by $1.37 million, or 1.2 percent, compared with 2019. By the end of 2019, the line had grown by 64.26 percent over 2018, ending 2019 with $114.24 million in surplus lines premium.

The 10 lines showing premium decreases made up 5.93 percent of all surplus lines writings in 2020. They were Ocean Marine, down $12.26 million, or 31.37 percent; Surety, reporting negative premium, and therefore down $11.40 million, or more than 1,000 percent; Group Accident and Health, down $10.58 million, or 12.53 percent; Homeowners Multiple Peril, down $7.91 million or 3.44 percent; Fidelity, down $5.69 million, or 82.62 percent; Products Liability, down $2.12 million, or 7.33 percent; All Other A&H, down $1.65 million or 11.51 percent; Farmowners Multiple Peril, down $0.59 million, or 27.94 percent; Other Private Passenger Auto Liability, also reporting negative premium, was down $0.21 million, or 132.17 percent. There was no premium reported in Boiler and Machinery for 2020, down from $623 in premium last year.

With 2.80 percent of all surplus lines premium written in Texas in 2020, Homeowners Multiple Peril was the highest premium volume line experiencing a decrease compared with 2019. While Homeowners Multiple Peril premium declined by 3.44 percent, the number of policies filed in the line decreased by 10.8 percent.

The decrease in premium for Group Accident and Health, Products Liability, Ocean Marine, All Other A&H and Farmowners Multiple Peril were moves in the same direction as the decreases in the count of policies filed in these lines. However, the premium decrease in Fidelity was accompanied by a marginal increase in policies filed with the stamping office.

By year-end, SLTX collected nearly $11.89 million in stamping fees, a 14.0 percent increase over last year. Online filings were only marginally below last year’s online filings at 97.8 percent. The number of mailed in filings for the year rose just slightly, from 22,478 in 2019 to 23,391 in 2020. About 98.25 percent of the total premium was reported through online filings. SLTX processed 3.1 percent fewer filings and 3.3 percent fewer policies in 2020 than it did in 2019, at an average cost per policy of $16.57.