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Article: Trouble ahead: with the construction slump expected to linger, surety insurers ponder their next moves.(Property/Casualty: Surety and Fidelity)(Statistical table)(Company rankings)
- Article from:
- Best's Review
- Article date:
- June 1, 2009
- Author:
CopyrightCOPYRIGHT 2009 A.M. Best Company, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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* The News: Surety writers are bracing for a slowdown in construction.
* The Background: The surety line notched a 30% improvement in incurred losses in 2008 versus 2007.
* What It Means: Fewer construction projects may leave surety insurers more vulnerable to losses and surety bond defaults.
A strong 2008 performance in terms of incurred losses may not be the best indicator of what lies ahead for the $5.3 billion surety industry.
A deeper pool of bidders vying for fewer construction projects threatens to add a layer of vulnerability in an industry already known by surety writers for running on thin ...