New RMS hurricane model may crimp surplus lines capacity

Surplus lines insurers are finding that their property exposures are uncomfortably larger under a revised catastrophe model, and some are considering whether to shrink availability or adjust their capital to cover the additional risk. Insurers and brokers at the National Assn. of Professional Surplus Lines Offices Ltd.’s annual conference in San Diego last week said Risk Management Solutions Inc.’s Version 11 Atlantic hurricane model—which increases potential inland damage from hurricanes, among other changes—is causing companies to rethink how they underwrite windstorm exposures.