7 April 2015 Insurance

TWIA transfers $262m into cat reserve fund

The Texas Windstorm Insurance Association (TWIA) has transferred $262.7 million into the catastrophe reserve trust fund (CRTF).

The transfer brings the CRTF total to its largest balance at approximately $480 million and, as part of overall projected funding of $4.9 billion for 2015, ensures sufficient funding to pay insured losses from a 100-year storm season.

According to TWIA’s governing statute, Texas Insurance Code Chapter 2210, the CRTF is the first funding source to be used to pay insured losses, after premiums, and all net gains from TWIA operations must be transferred into the fund annually.

TWIA now has more than $1.1 billion in cash immediately available to fund losses from 2015 premiums, the CRTF, and $500 million in pre-event class 1 bonds issued in 2014.

“TWIA meeting our projected CRTF contribution goal, as submitted in our biennial report to the 84th legislature, tells just one part of our improvement story and reflects the Association’s continuing commitment to policyholders and other valued stakeholders,” said TWIA general manager, John Polak. “Our projected $4.9 billion funding level is over one billion dollars more than TWIA had available in 2014. Compared to the $3 billion 2008 hurricane season, it’s clear we’re in very good shape for 2015 and beyond.”

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