HCI secures $1.5bn catastrophe reinsurance limit at renewal
HCI Group, a provider of property/casualty insurance in Florida, has completed its 2019-2020 catastrophe reinsurance programme, securing a total limit of $1.477 billion.
The programme provides coverage up to approximately $901 million for catastrophic losses in a single event, excluding flood losses.
According to catastrophe models approved by the Florida Office of Insurance Regulation, the coverage is sufficient to cover the company’s probable maximum loss resulting from a 1 in 282-year storm.
Net reinsurance premiums, excluding flood for the contract year that began June 1, 2019, are expected to be $112 million, assuming no losses occur during that period. Although, expected growth from TypTap Insurance Company, HCI’s technology driven insurance subsidiary, could increase net reinsurance premiums at the exposure true up on September 30, 2019.
Based on assumed growth and including reinsurance premiums for flood, HCI’s total ceded reinsurance premiums for the 2019-2020 contract year are estimated to be $124 million.
“We received strong support from our reinsurers based on our data transparency, insourced business model, and internally developed claims software,” said Paresh Patel, HCI’s chief executive officer. “In addition, we purchased a similar tower structure, maintained our 45% FHCF election, and reduced our absolute spend compared with last year’s program while keeping our first and second event retentions unchanged.”
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