In this issue, we kick off the year with a look at the 10 largest niche markets in the United States. These markets provide a total of $35.12 billion in commercial lines premium or 27.7% of total commercial premiums written, according to data obtained from IMR (Insurance Market Research) Corp. The loss ratio is 56.7%.
"The 10 largest markets include 1,133,135 individual business establishments, employing more than 32 million people," notes Lindsay Smith, president of IMR Corp., one of the PLP Companies. "The largest niche market in the United States (as defined by SIC Code) is trucking and courier services, except air, which provides more than $9 billion in premium and a loss ratio of 62.2%. The fact that the health care sector is growing faster than general inflation is reflected in the next two largest markets--offices and clinics of medical doctors, with nearly $5 billion in premium and a loss ratio of 57.6% and hospitals, with $3.36 billion and a loss ratio of 47.2%."
Rounding out the top 10 are general contractors and operative builders ($3.32 billion, 55.2% loss ratio); eating places ($2.99 billion, 58.0%); beef cattle, except feedlots ($2.84 billion, 64.5%); local governments ($2.63 billion, 43.4%); hogs ($2.24 billion, 61.8%); scheduled air transportation ($1.99 billion, 60.7%); and plumbing, heating and air conditioning ($1.77 billion, 41.1%).
There are 927,444 small establishments (employing fewer than 20 people) in this group which account for $12.86 billion in premium for an average premium of $13,865 per account. There are 183,951 medium-sized accounts (20-99 employees) providing $10.62 billion in premium for an average of $57,720. The 18,230 large firms (100-499 employees) account for $5.85 billion in premium and an average of $320,940 per account. The 3,510 jumbo accounts provide $5.79 billion for an average of $1.65 million per account.
These businesses provide $6.91billion in premium in the Rough Notes West region. The loss ratio is 57.6%. Trucking and courier services represent the largest subgroup, accounting for $1.64billion in premium and a loss ratio of 59.7%. Offices and clinics of medical doctors are next, with $1.02billion and a loss ratio of 58.0%. They are followed by general contractors and operative builders ($812.3 million, 55.7%); eating places ($714.8 million, 67.4%); beef cattle ($567.8 million, 69.3%); local governments ($554.7 million, 37.6%); scheduled air transportation ($515.3million, 68.4%); hospitals ($511.2 million, 46.1%); plumbing, heating and air conditioning ($348.7million, 40.1%); and hogs ($221.4 million, 63.1%).
There are 227,360 establishments in this group in the West, employing 6.10 million people. The 188,156 small firms (those employing fewer than 20 people) account for $2.57billion in premium for an average of $13,655 per account. The 34,997 medium-sized accounts (20-99 employees) provide $2.12 billion in premium for an average of $60,685 per account. The 3,592 large firms (100-499) account for $1.15 billion for an average of $321,250 per account, and the 615 jumbo accounts provide $1.06 billion for an average of $1.72million per account.
Information on this niche market is available from IMR at 39 E. Hanover Ave., Morris Plains, NJ 07950, or call (888) 237-7066. *
©COPYRIGHT: The Rough Notes Magazine, 1999