If you own property in South Florida, there is a good chance you have heard your agent mention the "E&S market," usually right after telling you a standard company said no. Here are plain-English answers to the questions we hear most from property owners in Boca Raton, Miami-Dade, Broward and Palm Beach.
What does "E&S" actually stand for?
E&S stands for excess and surplus lines. It is the part of the insurance market that covers risks the standard (also called "admitted") market will not take. When a standard company declines a property, a surplus lines company can often write it instead.
Why would my property need E&S coverage?
Standard companies follow strict underwriting rules set and filed with state regulators. If your property falls outside those rules, they have to say no. Common reasons in South Florida include an older roof, coastal exposure, prior claims, a building with deferred maintenance, or a type of risk standard companies simply do not write, like apartment buildings owned by an LLC or LP.
Is E&S insurance legitimate and safe?
Yes. Surplus lines companies are legal, regulated insurers. The difference is that their rates and policy forms are not filed with the state the way standard companies' are, which gives them the flexibility to write unusual risks. One real tradeoff: surplus lines policies are not backed by the state's guaranty fund if the insurer becomes insolvent, so the financial strength of the company matters. A good agent checks that before recommending a policy.
What kinds of South Florida properties typically end up in the E&S market?
We see it most with apartment buildings and multifamily properties owned by LLCs and LPs, condo associations with older buildings or open inspection items, rental properties, and coastal homes. A large share of Florida's commercial habitational insurance is written in the E&S market because many standard companies have pulled back from the state.
Does E&S coverage cost more?
Usually, yes, because the risks are harder to place. Surplus lines policies also carry state taxes and fees that standard policies do not. The right way to think about it: E&S is often the difference between having real coverage and having none at all.
Can I move back to the standard market later?
Often, yes. If the reason you were declined gets fixed, for example a new roof, updated electrical, or a few clean claim years, standard options may open up again. Part of our job is to re-shop your coverage when that happens instead of leaving you in the E&S market forever.
What should I ask my agent before accepting an E&S policy?
Ask why the standard market declined you, what the insurer's financial strength rating is, what the policy excludes, whether it is assessable, and what would need to change for standard-market options to come back. A good agent welcomes those questions.
Have questions about an E&S quote or a decline you received? Call us at (516) 476-6742 or reach out through our contact page. We are happy to explain your options in plain English.
This article is for general informational purposes only and is not insurance, legal, or financial advice. Coverage availability, terms, and eligibility vary by insurer and individual circumstances. Consult a licensed insurance professional about your specific situation.