Surety industry underwriting results have remained relatively stable since 2005. Loss activity spiked in the early 2000s, leading to combined ratios ranging between 124 percent in 2001 and 117 percent in 2004 (see Figure 1). Factors contributing to the high combined ratios in the early 2000s included sharply increased competition in the surety sector in the late 1990s, higher loss frequency among large accounts and a lack of sophisticated underwriting tools.
