Universal renews 2019 reinsurance programme with extra $134m limit
Universal Property & Casualty Insurance Company (UPCIC) has expanded the top of its reinsurance tower for a single Florida event to $3.28 billion (an increase of $134 million) as part of Universal Insurance Holdings’ 2019-2020 reinsurance programmes, effective June 1, 2019.
Participants in the Universal reinsurance programme include Nephila Capital via Allianz Risk Transfer, Everest Re, RenaissanceRe, Munich Re, Arch Re, Chubb Tempest Re and Lloyd's of London syndicates.
The total cost of the 2019-2020 reinsurance programme for UPCIC and American Platinum Property and Casualty Insurance Company (APPCIC) is projected to be approximately 33.3 percent of estimated direct earned premium for the 12-month treaty period compared to 31.2 percent at this time last year reflecting a 6.7 percent year-over-year increase.
Furthermore, UPCIC has secured $222.6 million of new catastrophe capacity with contractually agreed limits that extend coverage to the 2020 wind season or beyond. Overall, UPCIC now has $382.6 million of this multi-year capacity, all of which is below the Florida Hurricane Catastrophe Fund layer, where reinsurance costs are the highest.
UPCIC also increased its first event catastrophe retention for a Florida loss from $35 million to $43 million, and for a loss involving states other than Florida from $5 million to $10 million.
"We are pleased to announce the completion and outcome of the 2019-2020 reinsurance programs for both of our insurance companies. While this renewal process consumed a greater period of time than prior years, we are pleased with the end result," said Jon Springer, president and chief risk officer.
"We respect our reinsurance partners' evolving view of risk and see the pricing level changes as reasonable given the recent loss experience. Importantly, we successfully secured more catastrophe coverage than at any point in the history of the Company while maintaining our core relationships with our reinsurance partners," he added.
