Surety Market to Reach US$ 28.77 Billion at CAGR of 7.5% by 2027 | The Insight Partners

Surety Market to 2027 - Global Analysis and Forecasts by Bond Type (Contract Surety Bond, Commercial Surety Bond, Fidelity Surety Bond, and Court Surety Bond)

Publication Month: Jan 2019 | Report Code: TIPRE00002849 | No. of Pages: 130 | Category: Manufacturing and Construction | Status: Published

The global surety market at US$ 15.33 Bn in 2018 and is expected to grow at a CAGR of 7.5% during the forecast period 2019 – 2027, to account to US$ 28.77 Bn by 2027.

The Surety market penetration rates in North America region is higher than any other markets across the globe. This is attributed to most of U.S. State governments’ laws that mandate surety bonds. Both the U.S. and Canada Surety markets are ruled by insurers, and banks play only a minor role. In APAC region, the Surety market is expected to flourish during the forecast period. This growth is highly attributed to the increasing commercial and residential construction in the emerging economies of the region.

Exhibit: Surety Lucrative Regional Markets

 

 

 

Market Insights

Contract surety bond holding nearly half of the surety market share

Contract Surety Bonds deliver financial security as well as construction assurance on construction and building projects by guaranteeing the project owner that the contractor is competent to accomplish the work and will pay certain subcontractors, material suppliers, and laborers. These bonds are used principally in the construction industry. The growth of both public and private construction sector coupled with stringent government regulations for contract surety bonds, the market is anticipated to flourish during the forecast period.

 

Acceptance of Public Private Partnership (PPP) Model to propel surety market growth

The gaining popularity of PPP in both developed, as well as emerging economies worldwide, is one of a major driver for Surety market. Infrastructure investment and development are the main concern for governments across the globe. With increasing urbanization, the emerging economies are witnessing a need to develop their critical infrastructure, while developed economies are in need to expand or reconstruct their existing assets. The enduring evolution in PPP model is noticed with increased demand for infrastructure development as well as growing fiscal constraints, to support governments’ fulfill these escalating infrastructure challenges.

 

Merger & Acquisition to be the key strategy

Merger and acquisition is expected to be the key growth strategy to be adopted by players for next two-three years. However, this strategy could impact competition, it is also expected to generate new market as well as product opportunities as recently combined companies will thrive to maintain position and profitability.

 

Bond Type Insights

The Surety market by revenue model is led by contract surety bond. The most common surety bonds are the commercial and contract surety bond and serve the purpose of protecting the public and private interests. The court and fidelity surety bonds protect against the litigation and theft. Surety bonds of all types cost a premium based on the performance of the business and credit score of the business owner which is between 1-15% of the bond value.

Exhibit: Europe Surety Market by Revenue Model                  

 

Strategic Insights

The market cycles for surety and construction have been stable, resulting in increased competition. With the falling oil & gas prices, the current market scenario requires diligence as well as constant high underwriting standards. Terms and conditions related to underwriting are loosening as surety players are fiercely endeavoring to grow market share. Some of the key developments noticed in the surety market are listed below:

 

2018: AmTrust Financial Services, Inc. entered into an amendment to the merger agreement with Evergreen Parent, L.P., under this agreement Evergreen parent will acquire approximately 45% of the Company's shares of common stock. 


2018:
American Financial Group announced entering into an agreement to acquire ABA Insurance Services Inc. for approximately US$ 28 Mn. This acquisition is aimed to strengthen the position of the company in the market.


2018:
Chubb Limited entered into an agreement with Citibanamex which is a subsidiary of Citi Bank to market Chubb’s products through its branches and other marketing channels. Citibanamex also agreed to market surety products to Citibanamex commercial customers. 

 

GLOBAL SURETY MARKET SEGMENTATION

By Bond Type

  • Contract Surety Bond
  • Commercial Surety Bond
  • Fidelity Surety Bond
  • Court Surety Bond

By Geography

  • North America
    • U.S.
    • Canada
    • Mexico
  • Europe
    • Germany
    • UK
    • Spain
    • France
    • Italy
    • Rest of Europe
  • Asia Pacific (APAC)
    • Australia
    • South Korea
    • China
    • Japan 
    • Rest of APAC
  • Middle East & Africa
    • South Africa
    • Saudi Arabia
    • UAE
    • Rest of MEA
  • South America (SAM)
    • Brazil
    • Rest of SAM

Company Profiles

  • American Financial Group, Inc.
  • AmTrust Financial Services, Inc.
  • Chubb Limited
  • CNA Financial Corporation
  • Crum & Forster
  • Hartford Financial Services Group, Inc.
  • HCC Insurance Holdings
  • IFIC Surety Group 
  • Liberty Mutual Insurance Company
  • The Travelers Indemnity Company

TABLE OF CONTENTS

1. INTRODUCTION 11
1.1 SCOPE OF THE STUDY 11
1.2 THE INSIGHT PARTNERS RESEARCH REPORT GUIDANCE 11

2. KEY TAKEAWAYS 12

3. SURETY MARKET LANDSCAPE 14
3.1 MARKET OVERVIEW 14
3.2 MARKET SEGMENTATION 16
3.2.1 Global Surety Market – By Bond Type 16
3.2.2 Global Surety Market – By Geography 17
3.3 PEST ANALYSIS 18
3.3.1 North America PEST Analysis 18
3.3.2 Europe PEST Analysis 21
3.3.3 Asia Pacific PEST Analysis 23
3.3.4 Middle East and Africa PEST Analysis 25
3.3.5 South America PEST Analysis 27

4. SURETY MARKET – KEY INDUSTRY DYNAMICS 29
4.1 KEY MARKET DRIVERS 29
4.1.1 Ageing infrastructure of developed economies creating a need for massive investments in its restoration 29
4.1.2 Global acceptance of Public Private Partnership Model anticipated to drive the Surety market growth 30
4.2 KEY MARKET RESTRAINTS 31
4.2.1 Shortage of properly trained underwriter in the Surety Industry 31
4.3 KEY MARKET OPPORTUNITIES 31
4.3.1 Rising need for innovative insurance solutions to offer prosperous opportunity to Surety market 31
4.4 FUTURE TRENDS 32
4.4.1 Adoption of Surety bond by diverse end-use industries 32
4.5 IMPACT ANALYSIS OF DRIVERS AND RESTRAINTS 32
 
5. SURETY – GLOBAL MARKET ANALYSIS 33
5.1 GLOBAL SURETY MARKET OVERVIEW 33
5.2 GLOBAL SURETY MARKET FORECAST AND ANALYSIS 35

6. SURETY MARKET REVENUE AND FORECASTS TO 2027 – BOND TYPE 36
6.1 OVERVIEW 36
6.2 GLOBAL SURETY MARKET BREAKDOWN, BY BOND TYPE, 2017 & 2027 36
6.3 CONTRACT SURETY BOND 37
6.3.1 Overview 37
6.3.2 Contract Surety Bond Market Forecasts and Analysis 37
6.4 COMMERCIAL SURETY BOND 39
6.4.1 Overview 39
6.4.2 Commercial Surety Bond Market Forecasts and Analysis 39
6.5 FIDELITY SURETY BOND 40
6.5.1 Overview 40
6.5.2 Fidelity Surety Bond Market Forecasts and Analysis 40
6.6 COURT SURETY BOND 41
6.6.1 Overview 41
6.6.2 Court Surety Bond Market Forecasts and Analysis 41

7. GLOBAL SURETY MARKET – GEOGRAPHICAL ANALYSIS 42
7.1 OVERVIEW 42
7.2 NORTH AMERICA SURETY MARKET REVENUE AND FORECASTS TO 2027 43
7.2.1 North America Surety Market Revenue and Forecasts to 2027 (US$ Bn) 45
7.2.2 North America Surety Market Breakdown, by Key Countries 45
7.2.2.1 U.S. Surety Market Revenue and Forecasts to 2027 (US$ BN) 46
7.2.2.2 Canada Surety Market Revenue and Forecasts to 2027 (US$ Bn) 47
7.2.2.3 Mexico Surety Market Revenue and Forecasts to 2027 (US$ Bn) 48
7.3 EUROPE SURETY MARKET REVENUE AND FORECASTS TO 2027 50
7.3.1 Overview 50
7.3.2 Europe Surety Market Breakdown by Key Countries 51
7.3.2.1 UK Surety Market Revenue and Forecasts to 2027 (US$ Bn) 52
7.3.2.2 Germany Surety Market Revenue and Forecast to 2027 (US$ Bn) 53
7.3.2.3 France Surety Market Revenue and Forecast to 2027 (US$ Bn) 54
7.3.2.4 Spain Surety Market Revenue and Forecast to 2027 (US$ Bn) 55
7.3.2.5 Italy Surety Market Revenue and Forecast to 2027 (US$ Bn) 56
7.3.2.6 Rest of Europe Surety Market Revenue and Forecast to 2027 (US$ Bn) 57
7.3.3 Europe Surety Market Breakdown by Bond Type 57
7.4 ASIA-PACIFIC SURETY MARKET REVENUE AND FORECASTS TO 2027 59
7.4.1 Overview 59
7.4.2 Asia-Pacific Surety Market Breakdown by Key Countries 60
7.4.2.1 South Korea Surety Market Revenue and Forecasts to 2027 (US$ Bn) 61
7.4.2.2 China Surety Market Revenue and Forecast to 2027 (US$ Bn) 62
7.4.2.3 Australia Surety Market Revenue and Forecast to 2027 (US$ Bn) 63
7.4.2.4 Japan Surety Market Revenue and Forecast to 2027 (US$ Bn) 64
7.4.2.5 Rest of APAC Surety Market Revenue and Forecast to 2027 (US$ Bn) 65
7.4.2.6 Asia-Pacific Surety Market Breakdown by Bond Type 65
7.5 MEA SURETY MARKET REVENUE AND FORECASTS TO 2027 67
7.5.1 Overview 67
7.5.2 MEA Surety Market Breakdown by Key Countries 68
7.5.2.1 Saudi Arabia Surety Market Revenue and Forecasts to 2027 (US$ Bn) 68
7.5.2.2 UAE Surety Market Revenue and Forecast to 2027 (US$ Bn) 69
7.5.2.3 South Africa Surety Market Revenue and Forecast to 2027 (US$ Bn) 70
7.5.2.4 Rest of MEA Surety market Revenue and Forecasts to 2027 (US$ Bn) 71
7.5.3 MEA Surety Market Breakdown by Bond Type 71
7.6 SOUTH AMERICA SURETY MARKET REVENUE AND FORECASTS TO 2027 73
7.6.1 Overview 73
7.6.2 SAM Surety Market Breakdown by Key Countries 74
7.6.2.1 Brazil Surety Market Revenue and Forecasts to 2027 (US$ Bn) 75
7.6.2.2 Rest of SAM Surety Market Revenue and Forecasts to 2027 (US$ Bn) 76

8. INDUSTRY LANDSCAPE 78
8.1 MARKET INITIATIVE 78
8.2 MERGER AND ACQUISITION 78

9. COMPETITIVE LANDSCAPE 79
9.1 COMPETITIVE SERVICE MAPPING 79
9.2 MARKET POSITIONING – GLOBAL TOP 5 PLAYERS RANKING 79

10. SURETY MARKET, KEY COMPANY PROFILES 81
10.1 AMTRUST FINANCIAL SERVICES, INC. 81
10.1.1 Key Facts 81
10.1.2 Business Description 81
10.1.3 Financial Overview 82
10.1.4 SWOT Analysis 82
10.1.5 Key Developments 84
10.2 CRUM & FORSTER 85
10.2.1 Key Facts 85
10.2.2 Business Description 85
10.2.3 Financial Overview 86
10.2.4 SWOT Analysis 86
10.2.5 Key Developments 87
10.3 CNA INSURANCE GROUP. 88
10.3.1 Key Facts 88
10.3.2 Business Description 88
10.3.3 Financial Overview 89
10.3.4 SWOT Analysis 89
10.3.5 Key Developments 91
10.4 AMERICAN FINANCIAL GROUP, INC. (AFG) 92
10.4.1 Key Facts 92
10.4.2 Business Description 92
10.4.3 Financial Overview 93
10.4.4 SWOT Analysis 93
10.4.5 Key Developments 95
10.5 THE TRAVELERS INDEMNITY COMPANY 96
10.5.1 Key Facts 96
10.5.2 Business Description 96
10.5.3 Financial Overview 97
10.5.4 SWOT Analysis 97
10.5.5 Key Developments 98
10.6 LIBERTY MUTUAL INSURANCE COMPANY 99
10.6.1 Key Facts 99
10.6.2 Business Description 99
10.6.3 Financial Overview 100
10.6.4 SWOT Analysis 100
10.6.5 Key Developments 101
10.7 HARTFORD FINANCIAL SERVICES GROUP, INC. 102
10.7.1 Key Facts 102
10.7.2 Business Description 102
10.7.3 Financial Overview 103
10.7.4 SWOT Analysis 103
10.7.5 Key Developments 105
10.8 HCC INSURANCE HOLDINGS, INC. (TOKIO MARINE & NICHIDO FIRE INSURANCE CO., LTD.) 106
10.8.1 Key Facts 106
10.8.2 Business Description 106
10.8.3 Financial Overview 107
10.8.4 SWOT Analysis 107
10.8.5 Key Developments 109
10.9 IFIC SURETY GROUP 110
10.9.1 Key Facts 110
10.9.2 Business Description 110
10.9.3 Financial Overview 111
10.9.4 SWOT Analysis 111
10.9.5 Key Developments 112
10.10 CHUBB LIMITED 113
10.10.1 Key Facts 113
10.10.2 Business Description 113
10.10.3 Financial Overview 114
10.10.4 SWOT Analysis 114
10.10.5 Key Developments 116

11. APPENDIX 117
11.1 ABOUT THE INSIGHT PARTNERS 117
11.2 GLOSSARY 117
11.3 METHODOLOGY 118
11.3.1 COVERAGE 118
11.3.2 Secondary Research 118
11.3.3 Primary Research 119
 
LIST OF TABLES

TABLE 1. GLOBAL SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 35
TABLE 2. GLOBAL SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY REGIONS (US$ BN) 42
TABLE 3. NORTH AMERICA SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY BOND TYPE (US$ BN) 49
TABLE 4. EUROPE SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY BOND TYPE (US$ BN) 58
TABLE 5. ASIA-PACIFIC SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY BOND TYPE (US$ BN) 66
TABLE 6. MEA SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY BOND TYPE (US$ BN) 72
TABLE 7. SOUTH AMERICA SURETY MARKET REVENUE AND FORECASTS TO 2027 – BY BOND TYPE (US$ BN) 77
TABLE 8. GLOSSARY OF TERMS, SURETY MARKET 117
 
LIST OF FIGURES

FIGURE 1. APAC SURETY MARKET, TOTAL REVENUE (US$ BN), 2017 & 2027 12
FIGURE 2. CONTRACT SURETY BOND MARKET, BY REVENUE (US$ BN), 2017 & 2027 13
FIGURE 3. SURETY MARKET SEGMENTATION 16
FIGURE 4. NORTH AMERICA – PEST ANALYSIS 18
FIGURE 5. EUROPE – PEST ANALYSIS 21
FIGURE 6. ASIA PACIFIC – PEST ANALYSIS 23
FIGURE 7. MIDDLE EAST AND AFRICA – PEST ANALYSIS 25
FIGURE 8. SOUTH AMERICA – PEST ANALYSIS 27
FIGURE 9. SURETY MARKET IMPACT ANALYSIS OF DRIVER AND RESTRAINTS 32
FIGURE 10. GLOBAL SURETY MARKET 33
FIGURE 11. GLOBAL SURETY MARKET FORECAST AND ANALYSIS, (US$ BN) 35
FIGURE 12. SURETY MARKET BREAKDOWN, BY BOND TYPE, 2017 & 2027 (%) 36
FIGURE 13. CONTRACT SURETY BOND MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 38
FIGURE 14. GLOBAL COMMERCIAL SURETY BOND MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 39
FIGURE 15. FIDELITY SURETY BOND MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 40
FIGURE 16. COURT SURETY BOND MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 41
FIGURE 17. SURETY MARKET, GLOBAL BREAKDOWN BY GEOGRAPHY, 2017 & 2027 (%) 42
FIGURE 18. NORTH AMERICA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 45
FIGURE 19. NORTH AMERICA SURETY MARKET BREAKDOWN BY KEY COUNTRIES, 2017 & 2027(%) 45
FIGURE 20. U.S. SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 46
FIGURE 21. CANADA SURETY SYSTEM MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 47
FIGURE 22. MEXICO SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 48
FIGURE 23. NORTH AMERICA SURETY MARKET BREAKDOWN BY BOND TYPE, 2017 & 2027 (%) 49
FIGURE 24. EUROPE SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 50
FIGURE 25. EUROPE SURETY MARKET BREAKDOWN BY KEY COUNTRIES, 2017 & 2027 (%) 51
FIGURE 26. UK SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 52
FIGURE 27. GERMANY SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 53
FIGURE 28. FRANCE SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 54
FIGURE 29. SPAIN SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 55
FIGURE 30. ITALY SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 56
FIGURE 31. REST OF EUROPE SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 57
FIGURE 32. EUROPE SURETY MARKET BREAKDOWN BY BOND TYPE, 2017 & 2027 (%) 57
FIGURE 33. ASIA-PACIFIC SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 59
FIGURE 34. ASIA-PACIFIC SURETY MARKET BREAKDOWN BY KEY COUNTRIES, 2017 & 2027 (%) 60
FIGURE 35. SOUTH KOREA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 61
FIGURE 36. CHINA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 62
FIGURE 37. AUSTRALIA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 63
FIGURE 38. JAPAN SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 64
FIGURE 39. REST OF APAC SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 65
FIGURE 40. ASIA-PACIFIC SURETY MARKET BREAKDOWN BY BOND TYPE, 2017 & 2027 (%) 65
FIGURE 41. MEA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 67
FIGURE 42. MEA SURETY MARKET BREAKDOWN BY KEY COUNTRIES, 2017 & 2027 (%) 68
FIGURE 43. SAUDI ARABIA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 68
FIGURE 44. UAE SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 69
FIGURE 45. SOUTH AFRICA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 70
FIGURE 46. REST OF MEA SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 71
FIGURE 47. MEA SURETY MARKET BREAKDOWN BY BOND TYPE, 2017 & 2027 (%) 71
FIGURE 48. SAM SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 73
FIGURE 49. SAM SURETY MARKET BREAKDOWN BY KEY COUNTRIES, 2017 & 2027(%) 74
FIGURE 50. BRAZIL SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 75
FIGURE 51. REST OF SAM SURETY MARKET REVENUE AND FORECASTS TO 2027 (US$ BN) 76
FIGURE 52. SOUTH AMERICA SURETY MARKET BREAKDOWN BY BOND TYPE, 2017 & 2027 (%) 76

The List of Companies

1. AmTrust Financial Services, Inc.
2. Crum & Forster
3. CNA Financial Corporation
4. American Financial Group, Inc.
5. The Travelers Indemnity Company
6. Liberty Mutual Insurance Company
7. Hartford Financial Services Group, Inc.
8. HCC Insurance Holdings
9. IFIC Surety Group
10. Chubb Limited






 

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