...2015 Outlook: Profitability is likely to weaken slightly for excess and surplus (E&S) lines insurance writers in 2015 as pricing pressure and diminishing favorable loss reserve development reduce underwriting performance and continued low asset yields adversely affect investment income. Premium growth is expected to continue into 2015, led by exposure growth in accordance with modest economic expansion with a reduced contribution from price movements. Underwriting profitability is likely to deteriorate modestly in 2016, but E&S underwriters are likely to still outperform standard market underwriters barring any unusually severe catastrophic events. E&S Outperforms P/C Industry: Fitch Ratings' analysis of statutory premium and aggregate underwriting performance of U.S. E&S insurers reveals that over the longer term, these underwriters outperformed the P/C industry's combined ratio by an average of 9 percentage points for the 2010-2014 period. However, E&S underwriting results are more volatile...
