KBW predicts Tropical Storm Dorian ‘likely to impact reinsurers more than primary Florida insurers’

Tropical Storm Dorian is expected to strengthen into a hurricane and predictions suggest it could make landfall on the Florida coastline on Monday September 2 early in the morning, US east coast time.

Current National Hurricane Centre projections show Dorian tracking to make landfall east of Orlando and south of Jacksonville, with Daytona Beach the largest city near projected landfall.

Analysts Keefe, Bruyette & Woods (KBW) said that with the fairly low primary insurer retentions in Florida, “we think any sizable hurricane event and/or one that impacts a meaningful portion of Florida's east coast would likely impact reinsurers more than primary Florida insurers”.

KBW figures revealed insurers' catastrophe-exposed lines in Florida by company market share and ‘cat exposed direct written premiums as a percentage of total net written premiums’.

Berkshire Hathaway has 8 percent of market share and 3.2 percent of cat exposed DWP as a percentage of NWP; Progressive has 7.2 percent and 5.2 percent respectively; Universal Insurance Holdings has 4.3 percent and 122.2 percent respectively; Allstate Corp has 3.5 percent and 2.4 percent; AIG with 3.2 percent and 2.5 percent; Chubb with 2.8 percent and 2.2 percent; UIHC Insurance with 32.8 percent and 89.2 percent; Assurant with 2.3 percent and 17.1 percent; Heritage Insurance with 2.1 percent and 113 percent; FEDNAT with 2 percent and 131.3 percent; and HCI Group with 1.4 percent and 164.3 percent.

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