Surge in specialty carrier launches: ALIRT study

There has been a surge in new specialty carrier launches since 2018, many established to take advantage of an attractive pricing environment and the perceived growth of permanent niche underwriting opportunities, according to a recent study by ALIRT.

In its annual Surplus Lines study, ALIRT noted that while specialty carriers remain a relatively small part of the overall E&S market, it has witnessed an influx of new specialty carriers, particularly over the past five years.

The report stated, “Many of these new insurers were established to take advantage of an attractive pricing environment and perceived growth of permanent niche underwriting opportunities, securing an A- A.M. Best rating on the strength of seasoned management and initial capital raises.

“How these carriers will perform once E&S market pricing/opportunities ease is an important consideration and one that ALIRT will be closely monitoring.”

The study also found that performance trends in ALIRT’s 50-company E&S Lines Composite mirrored those of the overall surplus lines market, showing outsized revenue growth compared with the broader U.S. property & casualty industry, as well as surging profitability margins over the past three and a half years especially.

On operating performance, ALIRT reported that none of the 50 E&S Composite members fell outside its historically normal scoring range (39–61) as of 6 months 2025. In fact, 17 carriers in the cohort outperformed this range.

ALIRT added that the U.S. E&S market is best viewed through the lens of the larger U.S. P&C industry, as most surplus lines insurers are tightly integrated into larger insurance organisations. This is reflected in their extensive participation in intercompany pools (often 100% reinsured) and other affiliate reinsurance arrangements.