Travelers' US surety premiums rose 21% in Q3 2026, AM Best moved one Canadian surety to a negative outlook, and WTW expects flat surety rates for 2027.
Education only / verify at source / not legal, investment or placement advice. This is a market explainer built from company filings, a rating agency press release and a broker's published outlook. It is not investment commentary, a rating opinion or a recommendation about any surety. Global Guarantors publishes industry education. We aren't a surety, broker, rating agency or law firm, and we don't publish premiums. Check every figure and rating at its source before relying on it.
Start here: Surety glossary · How to verify a surety bond
Three kinds of surety market signal arrived in the space of three weeks this October, and each came from a different vantage point. Two large writers reported third-quarter results that showed double-digit growth in surety premium: Travelers said its domestic surety net written premiums rose 21% in the quarter, and Chubb's SEC-filed financial supplement showed its consolidated surety net premiums written up 22.3%. A rating agency, AM Best, revised its outlooks on a Canadian surety, Western Surety Company of Regina, Saskatchewan, to negative from stable while affirming its A- (Excellent) rating. And a large broker, WTW, published its 2027 surety outlook, calling for "Stable / Flat" rates across contract, commercial and international surety and describing underwriters as "growing more selective after years of strong results."
Read together, they describe a surety market that is profitable and well supplied with capacity, but one in which underwriters are paying closer attention to losses and to the quality of each account. None of these signals sets a market-wide trend on its own. Two carriers' results look backward at one quarter; a rating agency's outlook speaks to one company; a broker's forecast is a view, not a guarantee.
This piece sets out what each primary source actually says, explains the terms that tend to get misread (net written premium, segment combined ratio, prior-year reserve development, rating outlook), and closes with what more selective surety underwriting typically means in practice for contractors, principals and obligees. It is education, not investment or placement advice.
| Signal | What the primary source says |
|---|---|
| Premium growth | Travelers: domestic surety net written premiums up 21% to $414M in Q3 2026 |
| Premium growth (second writer) | Chubb: surety net premiums written up 22.3% to $249M in Q3 2026 (consolidated, all regions) |
| Segment profitability | Travelers Bond & Specialty Insurance combined ratio 77.3% (segment-wide, not surety-only) |
| Rating watch | AM Best: Western Surety Company (Regina) outlooks revised to negative; A- (Excellent) affirmed |
| 2027 pricing | WTW: contract, commercial and international surety "Stable / Flat" |
| Underwriting stance | WTW: "underwriters are growing more selective" |
The Travelers and Chubb figures cover different scopes and are reported on each company's own basis, so the table lists them side by side for reference only, not as a comparison or ranking.
Travelers reported its results for the quarter ended September 30, 2026 on October 16, 2026. Surety sits inside its Bond & Specialty Insurance segment, which the company describes as offering "surety, fidelity, management liability, professional liability, and other property and casualty coverages … primarily in the United States, and certain surety and/or specialty insurance products in Canada, the United Kingdom and the Republic of Ireland, as well as Brazil through a joint venture."
In the release's premium table, surety is a line under "Domestic." Travelers' domestic surety net written premiums were $414 million in the third quarter of 2026, up 21% from $342 million a year earlier. For the first nine months of the year they were $1,275 million, up 25% from $1,017 million. The company's chief executive put it this way: "In our leading Surety business, we grew net written premiums by 21%, reflecting continued strong production across the portfolio." "Leading" is the company's own description.
What net written premium measures. Net written premium is the premium an insurer writes in a period, net of what it cedes to reinsurers. It is a measure of volume: how much business was put on the books. It says nothing by itself about whether that business will be profitable, and in surety, where bonds are often written project by project, it can move sharply from one quarter to the next. Travelers' financial supplement shows domestic surety net written premiums of $381 million in the first quarter of 2026, $480 million in the second and $414 million in the third. The third quarter was up on the prior year but down from the second quarter, a reminder that surety premium is lumpy and that a single quarter is a thin basis for conclusions.
| Travelers item (Q3 2026) | Q3 2026 vs Q3 2025 | Change |
|---|---|---|
| Domestic surety net written premiums | $414M vs $342M | +21% |
| Bond & Specialty net written premiums (total) | $1,209M vs $1,080M | +12% (+13% excl. Canadian sale) |
| Bond & Specialty combined ratio | 77.3% vs 81.6% | Improved 4.3 points |
| Bond & Specialty underlying combined ratio | 85.8% vs 85.8% | Unchanged |
| Net favorable prior-year reserve development (pre-tax) | $95M vs $43M | Higher |
The combined ratio belongs to the segment. A combined ratio adds losses and expenses and divides them by earned premium; below 100% means an underwriting profit. The 77.3% figure is the combined ratio for the whole Bond & Specialty Insurance segment, which includes management liability, professional liability and other lines alongside surety. The release gives no surety-only combined ratio, so the 77.3% should not be read as a surety figure. The release says the ratio "improved 4.3 points due to higher net favorable prior year reserve development (4.4 points), partially offset by higher catastrophe losses (0.1 points)." The underlying combined ratio, which strips out prior-year development and catastrophes, was 85.8%, the same as a year earlier.
Prior-year reserve development, in plain terms. Insurers set aside reserves for claims they expect to pay on business already written. When earlier estimates turn out to be higher than needed, the release of the excess is "favorable" development. Travelers reported $95 million of net favorable prior-year reserve development in the segment for the quarter, up from $43 million. The company said it was "primarily driven by better than expected loss experience in the fidelity and surety product line for recent accident years and in the general liability product line for management liability coverages for multiple accident years." Both drivers matter: the $95 million is not a surety-only number.
Canada. Travelers still writes "certain surety and/or specialty insurance products in Canada," but the release reports no separate Canadian surety figure. Its prior-year Bond & Specialty figures included $14 million of net written premiums for the quarter ($40 million for nine months) "related to the Canadian operations which the Company divested in the first quarter of 2026," which is why the segment's growth is also shown excluding the sale. Our Travelers surety profile covers the Canadian carve-out and what remains.
Chubb released its third-quarter results after the market close on October 20, 2026, and filed its financial supplement with the SEC the same day as Exhibit 99.2 to a Form 8-K. The press release itself does not mention surety. The surety figures appear only as one row in the supplement's table of consolidated net premiums written by product line.
That row shows Chubb's surety net premiums written of $249 million in the third quarter of 2026, up 22.3% from $203 million in the third quarter of 2025, or 20.0% in constant dollars. For the first nine months of the year, surety net premiums written were $716 million, up 13.9% from $628 million, or 10.8% in constant dollars. Chubb uses the term "net premiums written"; Travelers uses "net written premiums." The concept is the same, and each company's own term is used here.
As with Travelers, this is a measure of volume, not profit. Neither Chubb's release nor its supplement gives a surety combined ratio, a surety loss ratio or surety reserve development, and none can be worked out from the figures published.
Scope also differs. Chubb's surety figure is consolidated across all the regions in which it writes, whereas Travelers' $414 million is domestic only. Because the two companies report on different bases and different geographies, the figures are not like-for-like, and this page does not rank or compare them. Neither Chubb document breaks out a Canadian surety figure. For background on Chubb's surety business, see our Chubb surety profile.
What the two filings do show, each on its own terms, is that two large writers reported double-digit growth in surety premium volume for the same quarter. That is consistent with the demand WTW describes below, but two companies' results do not by themselves establish a market-wide trend.
Not the same company as the CNA-owned Western Surety Company of Sioux Falls, South Dakota.
On October 15, 2026, at 1:20 PM Eastern (10:20 AM Pacific), AM Best said it "has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of "a-" (Excellent)" of Western Surety Company of Regina, Saskatchewan. The ratings themselves were affirmed. What changed was the direction AM Best sees them potentially moving.
AM Best said the ratings reflect a balance sheet strength it assesses as "very strong," operating performance it assesses as "adequate," a "limited" business profile and "appropriate" enterprise risk management. Its reasons for the negative outlook centre on results. It cited "continued volatility in WSC's operating performance, with the company generating net income in only three of the past five years and an underwriting gain in just two years." It said underwriting losses in 2025 were at "their highest level during the five-year period," and that the company "has experienced significant losses in the first quarter for the second consecutive year." Looking ahead, AM Best said: "Negative rating action may occur if WSC's underwriting performance fails to improve, operating metrics continue to underperform peers, or results fall short of the adequate operating assessment."
What an outlook is. In AM Best's framework, an outlook indicates the potential direction of a rating "over an intermediate period, generally defined as 36 months." AM Best also says that "Positive and Negative Outlooks do not necessarily lead to a change in the opinion." A negative outlook is therefore a signal to watch, not a rating change, and the rating in force remains A- (Excellent). Our guide to what a negative outlook means and doesn't explains how outlooks and ratings differ and where rating floors actually apply. Our Western Surety Company (Canada) profile has background on the company.
The industry line. AM Best's release also contains a sentence about the wider market: "The broader surety industry also has experienced elevated claims activity in recent years, but WSC's continued underwriting volatility and weaker performance relative to peers remain key concerns." That sentence is the bridge to the broker view below. AM Best treats elevated claims as an industry-wide backdrop, and WTW, from a different vantage point, says "loss activity is developing in pockets."
One caution on reading this alongside the carrier results above: Western Surety (Regina), Travelers and Chubb operate at very different scales and in different markets, so this page draws no comparison between their results.
WTW's "Insurance Marketplace Realities 2027 – Surety," dated October 1, 2026, gives the broker's view of the year ahead. Its rate predictions are the same for each of the three surety lines it tracks:
| Surety line | WTW 2027 rate trend |
|---|---|
| Contract | Stable / Flat |
| Commercial | Stable / Flat |
| International | Stable / Flat |
WTW summarises the market in one line: "Surety remains profitable and capacity plentiful, however underwriters are growing more selective after years of strong results." In its market overview it says capacity "remains abundant" and that demand is rising with investment in infrastructure, power and digital technology. It also identifies the pressure points: "margins have compressed modestly over the past 24 months, loss activity is developing in pockets, and underwriters are becoming more analytical and selective as a result." And it singles out one area: "Underwriting fundamentals remain strong, though developing loss activity on large civil projects has underwriters' attention."
New obligations versus existing programs. The most practical passage is about where price movement could appear. WTW says: "Surety rates are expected to remain stable across contract, commercial and international lines through 2027. Riskier obligations or softening credits may see higher entry points on new obligations, though increases on existing programs are unlikely." In plain terms, WTW expects established surety programs to hold their pricing, while a principal whose credit is weakening, or one taking on an obligation that underwriters view as riskier, may find the terms for a new bond set higher than before. WTW does not attach a percentage to any of this, and none should be inferred.
Demand drivers. WTW says that "Digital infrastructure and power spending is driving demand for much larger performance bonds and project security." Larger bonds can call for more surety capacity on a single account, which helps explain WTW's emphasis on preparation and early engagement with sureties.
Everything in this section is WTW's forecast as a broker. It is a reasoned market view as of October 1, 2026, not a guarantee of pricing or capacity on any account.
The October signals come from two carriers' results, one rating agency and one broker. Each is useful, and each has limits.
The carrier results are backward-looking and company-specific. They show what Travelers and Chubb wrote in one quarter, on their own reporting bases. Strong premium growth at large writers suggests healthy demand for surety credit, but it doesn't reveal the loss experience on that business, and premium volume can swing between quarters. Travelers' segment-level profitability figures include several lines besides surety, and Chubb publishes no surety profitability figure at all.
The rating agency's view concerns one company. AM Best's outlook revision on Western Surety (Regina) reflects that company's own results over five years. Its sentence about "elevated claims activity" in the broader industry is context, not a rating action on anyone else.
The broker's forecast looks forward across the market, but it is still one firm's opinion. WTW's "Stable / Flat" call and its description of more selective underwriting are consistent with the other signals: capacity is plentiful and premium is growing, but losses are being watched more closely.
Neither strong growth at one writer nor a negative outlook at another sets a market trend on its own. The more defensible reading is the one WTW states directly: a profitable surety market with ample capacity, in which underwriters are becoming "more analytical and selective."
What more selective underwriting means in practice. For a contractor or other principal, selectivity usually shows up in the underwriting file rather than in a headline rate. Surety underwriters typically ask for current financial statements, a work-in-progress schedule, backlog detail and evidence of experience with the size and type of work being bonded. A more selective underwriter tends to read those materials more closely, ask more follow-up questions and look harder at concentration in large or unfamiliar projects. Our underwriter desk pack walks through what underwriters commonly ask for, and our contract surety guide explains how performance and payment bonds and the surety credit behind them work.
For contractors and principals
For obligees and owners
Did AM Best downgrade Western Surety Company? No. On October 15, 2026, AM Best affirmed Western Surety Company's (Regina, Saskatchewan) Financial Strength Rating of A- (Excellent) and Long-Term Issuer Credit Rating of "a-" (Excellent), and revised the outlooks to negative from stable.
Is Travelers' 77.3% combined ratio a surety number? No. It is the combined ratio for Travelers' whole Bond & Specialty Insurance segment, which includes management liability, professional liability and other lines as well as surety. Travelers does not report a surety-only combined ratio in its release.
Did Chubb report a surety combined ratio? No. Chubb's supplement reports surety net premiums written only. Its 84.1% combined ratio for the quarter covers all of its property and casualty lines, not surety.
What does WTW expect for surety rates in 2027? WTW's rate prediction is "Stable / Flat" for contract, commercial and international surety.
Does a negative outlook mean a surety's bonds won't be accepted? A negative outlook is not a rating change. Whether a bond is acceptable depends on the obligee's own rules, such as an approved list, a licensing requirement or a contractual rating floor. Check those rules at the source.
Is surety capacity tightening? WTW describes capacity as "plentiful" and "abundant" while saying underwriters are "growing more selective."
