Thursday, January 21, 2010

Stamping Offices Report Surplus Lines Premiums Declined by 7.9 percent in 2009

The amount of premiums collected by surplus lines stamping offices continued to decline in 2009 according to a report by the Surplus Lines Stamping Office of Texas, with approximately $19.5 billion collected, compared to $21.2 billion in 2008. By comparison, in 2007 stamping offices reported processing $23 billion in premiums.

The 7.9% percent decline from 2008 to 2009 was slightly less than the 8.2% decline from 2007 to 2008. While there was a large decline in premiums written, the number of policies declined only by 1.9%, to 3.25 million items processed.

Of the 15 stamping offices in operation at the start of 2009, 13 reported declines in premiums, with only Texas and Mississippi reporting increases, 4.2% and 5.7% respectively. States reporting small decreases in premiums were Washington (-1.4%), Florida (-5.5%), Illinois (-7.0%), and New York (-9.5%).

Montana reported the largest percentage decline in premiums but their stamping office ceased operation as of July 1 as the state took over collection of premium taxes. All other state stamping offices reported double digit declines in premiums, including: Nevada (-20.9%), California (-19.0%), Oregon (-18.6%), Idaho (-15.2%), Pennsylvania (-12.5%), Utah (-12.0%), and Arizona (-11.9%).

Minnesota’s stamping office began operations in 2009 and reported $247 million in premiums. California reported the most premium in 2009 at $4.6 billion, followed by Florida at $4.15 billion, Texas at $3.4 billion and New York at $3 billion.

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