The US excess and surplus (E&S) homeowners market has evolved from niche to necessity as admitted insurers retreat from, reprice or restrict coverage for increasingly complex residential risks.

Amid moderation in growth in overall E&S volumes across business lines, direct E&S homeowners premiums rose 29.5% in 2025 to $4.14 billion, making it the fastest-growing domestic E&S segment. While California, Florida and Texas still account for most premium volume, the growth is increasingly national in scope, with many smaller and inland states posting faster expansion rates.

The shift is being driven by a combination of catastrophe exposure, regulatory constraints, inflation and reinsurance volatility. Severe convective storms and hail-related roof losses have become especially important drivers in states such as Minnesota, Colorado and Texas, pushing more homeowners business into the non-admitted market.

The outlook is still favorable for E&S homeowners, but the pace of growth may moderate in 2026 as competition increases and some carriers adjust limits or pricing. Even so, E&S remains a vital outlet for high-risk and high-value residential risks, and its role is likely to remain structurally larger than before.

The scope of the expansion

Homeowners E&S volumes grew by more than 20% for a third consecutive year. For comparison, the four E&S liability lines posted 13.0% year-over-year growth in the aggregate in 2025, while commercial auto expanded by 7.9%. Commercial property, once a primary E&S growth engine, shifted from driver to drag in 2025, contributing to the broader slowdown. The overall market grew by 7.7% in 2025, the first single-digit growth rate since 2018. E&S writers generally serve those residential properties that admitted insurers cannot cover at adequate limits or price efficiently due to wildfires, hurricanes, convective storms, inflation, regulatory constraints and reinsurance volatility.

Large, catastrophe-prone states like California, Florida and Texas have fueled the top-line growth because of the size of their premium bases: They combined to account for roughly 64% of the total US E&S homeowners direct premiums in 2025. But some of the most aggressive rates of expansion have occurred in inland and secondary states such as North Dakota, Oregon and Minnesota where admitted carriers have been pulling back due to concerns about exposure to perils such as severe convective storms and wildfires.

Hail is an increasingly significant driver of catastrophe claims involving roof damage. In 2025, 33% of all roofing claims were designated as catastrophe hail, according to Verisk's report, The State of America's Roofs The proportion of catastrophe hail claims has steadily increased annually from 19% in 2021. The average cost to replace a roof was $17,631 in 2025, up $1,764 from the four-year average between 2021 and 2024. Repair costs rose to $4,699 in the most recent year, up 25.2% over the prior four-year average.

Catastrophe-induced losses at the state level are volatile from period to period, but states with substantial hail-related losses in recent years — including Minnesota, Colorado and Texas, have recorded substantial growth within the E&S homeowners market.

With below-average catastrophe losses across the country in 2025, most states recorded exceptionally low direct loss and cost containment expense during the year. For example, Minnesota reported a direct loss and cost containment expense ratio of 41.8% in 2025, compared to cumulative result of 85.4% between 2021 and 2025. The state's three-year cumulative loss ratio was 69.1% at the end of 2025. Minnesota had exceptionally high loss ratios in back-to-back years, at 159.6% in 2022 and 110.9% in 2023. Colorado's loss ratio dropped to 31.8% in 2025 after its cumulative five-year and three-year loss ratios each around 70%.

Meanwhile, Minnesota's E&S homeowners premiums have surged to $22.8 million in 2025, up from $7.0 million in the prior year and just $4.0 million in 2022. Fortegra Specialty Insurance Co. was the largest E&S underwriter in the state, with $11.9 million in direct premiums in 2025, or 52.1% of the market.

Colorado's E&S homeowners direct premiums are expected to surpass $100 million in 2026. The state's E&S writers wrote $91.9 million in premiums during 2025, up 63.7% over the prior year and roughly 5.3 percentage points above its three-year CAGR. Markel Group Inc. with $29.4 million in direct homeowners premiums was the state's largest E&S writer, followed by Chubb Ltd.'s $17.4 million.

Texas, a state with significant exposure to both Gulf Coast hurricanes and hailstorms, ranked among the most rapidly growing markets in 2025 on both absolute and relative bases. Its homeowners E&S premiums, which totaled $453.6 million in 2025, grew by 63.4% over the prior year, in sharp contrast to the 5.6% expansion achieved by the admitted market. E&S homeowners premiums now constitute 2.2% of the total homeowners market, compared to 1.4% in 2024.

California remained the largest E&S homeowners market, accounting for nearly one-third of domestic premiums in 2025. Catastrophic wildfire losses and regulatory constraints on admitted insurers' ability to boost rates over the past decade have fueled this growth. Direct premiums reached $1.30 billion in 2025, up from $962.1 million in 2024 and $372.1 million in 2022. E&S homeowners expansion was no longer confined to the Golden State's high-risk or rural regions by 2025. The market was increasingly providing coverage in urban areas and for homes traditionally associated with the admitted market, signaling a structural shift in admitted-market scarcity rather than only catastrophe-driven displacement.

Regulatory reforms implemented in 2025, including the use of forward‑looking catastrophe models and the recognition of reinsurance costs in ratemaking, were designed to entice admitted insurers to reenter the market. Even so, E&S insurers' market share grew to 7.3% of California homeowners premiums in 2025 from 6.2% in the prior year.

Florida has continued to grow, but with signs of stabilization helped in part by regulatory reforms that went into effect at the beginning of 2023 along with light catastrophe losses over the past several years. Domestic E&S insurers reported $887.6 million in Florida homeowners direct premiums in 2025, an increase of 13.8% over the prior year. Despite the double-digit growth rate, E&S market share declined to 4.7% in 2025 from a 25-year peak of 5.1% in 2020.

The E&S market report offers a comprehensive overview of growth rates by business line and geography. It also provides market-share rankings at the group level for select business lines, including homeowners. Chubb remained the largest E&S homeowners insurer in the country with $416.5 million in premiums. Orion180 Insurance Co. was the fastest-growing E&S homeowners insurer in 2025, among the nation's 10 largest writers.