SECTION I – 2023 MARKET UPDATE: WINNERS AND LOSERS
In 2023, the California Surplus Lines market saw a lot of anomalous changes compared to the previous 4 – 5 years. While 2022 finished strong (premium up 23%, transactions up 10% from 2021), we began to observe declines in both premium and transactions in December, 2022. This behavior carried on well into the first half of 2023 with those early months either being flat or less than the prior year. However, transactions continued to increase into 2023. With some favorable months in the latter half of 2023, the models are indicating that fiscal year 2023 will end with 2% growth over 2022 in premium, and transaction growth at 9% over the prior year. Note that estimated stamping fees are expected to come in around 17% than the prior year, primarily due to the stamping fee rate reduction that began in January of this year.
| Fiscal Year | Transaction | Premium | Stamping Fee |
| 2022 | 912,576 | $16,258,928,475 | $40,771,746 |
| 2023 (REVISED) | 995,726 | $16,533,711,177 | $33,670,112 |
| 9% | 2% | -17% |
The charts below show the 2023 performance of the major industry groups and top 11 coverage codes that make up around 50% of the premium and transactions. While there were some industries and coverages that showed high growth this year, some of them do not have a favorable forecast for the next two years. This will be discussed in the next agenda section.