Tim Turner: property and casualty to continue to be key contributors to E&S growth

By David Bull

Feb 28 - (The Insurer) - Recent events including the LA wildfires and growing exposures in areas of high-value concentrations and high cat risk highlight the need for E&S property solutions, while the challenging loss environment in casualty is another driver of risks into the wholesale channel, according to Tim Turner.

The Ryan Specialty CEO was commenting on the outlook for the wholesaler and wider E&S market on its fourth-quarter and full-year earnings call earlier this month.

He noted that property pricing had declined modestly early in Q4 before the decline “accelerated significantly” in December 2024.

“Nevertheless, we overcame these trends as we took share of strong flow into the channel, won head-to-head against our competitors and had high renewal retention,” said the executive.

Given heightened concerns about large loss events, including the wildfires, hurricanes Milton and Helene and another heavy year of severe convective storms, there is “further proof of the long-term durability of and the need for E&S property solutions”.

“With our deep capabilities, we will continue to deliver value and offer solutions to the most complex issues our clients face irrespective of the market cycle.

“Given the continued uncertainty in the rate environment, we expect more modest growth in property this year, but we strongly believe property will remain an important contributor to our growth, particularly over the long term,” said Turner, who took over as CEO from executive chairman Pat Ryan on October 1.

The executive said that the firm’s wholesale brokerage business had seen an “outstanding year” in its casualty practice, with strong new business and high renewal retention.

“A persistently challenging loss environment is driving higher or in some lines, accelerating loss costs in numerous casualty classes. The admitted market continues to react to this trend by dumping and shedding risks, with those risks moving into the specialty and E&S market,” he observed.

Turner said that the E&S market has been responding well, with carriers tightening distribution lines, reunderwriting, shifting appetite, raising prices and focusing on limit management.

“As a result, we believe the need for specialised industry and product-level knowledge Ryan Specialty offers has never been greater and our value proposition has never been stronger. We remain confident that casualty will be a strong driver of our growth moving forward and that we will continue to be a leader in casualty solutions for years to come,” said the executive.

He reported that property pricing was down in Q4, but casualty pricing accelerated and broadened out across an increasing number of classes.

NO MEANINGFUL STANDARD LINES IMPACT ON FLOW

“Across both major classes, there remains uncertainty in the loss environment. This continues to drive higher retentions of risk and pushes new risks into the specialty and E&S marketplace,” he continued.

“We have consistently noted that in any cycle as certain lines are perceived to reach pricing adequacy, admitted markets tend to step back in on certain placements. However, this is still not playing out in any measurable way, and the standard market has not meaningfully impacted the rate or flow of our portfolio in the aggregate,” he continued.

Turner said that the firm continues to expect the flow of business into the specialty and E&S market to be a significant driver of Ryan Specialty’s growth over the long-term, more so than rate.

“The world is getting riskier and more complex. AI, cyber threats, climate change, social inflation, political unrest: these are all driving more risks into the E&S marketplace, which offers solutions that would otherwise not be available.

“We believe E&S will continue to outpace growth in the admitted market overshadowing any cyclical shifts. This is further supported by the significant commitment to the E&S market made by carriers that historically participated only in the admitted market and the addition of new capital,” he added.