Heritage pays 15% more for US reinsurance in 2022, may walk with less

Florida-based P&C carrier Heritage Insurance appears to have paid more for less, but did clear the bar with its closure of a mid-year reinsurance renewal, an updated disclosure from the firm suggests.

Heritage paid approximately $359.5 million for its coverage programme or 31% of end-Q1 premiums in force, up from the $312 million or 28% mark claimed one year prior.

But the fragmentary data also suggests a pared programme. To wit, first event reinsurance tower exhaustion points for the key southeast region is at $1.3 billion versus prior $1.4 billion. Loss retention there and in Hawaii rose 25% to $40 million and by roughly half in the northeast.

The new programme also includes a limit of $100 million from catastrophe bonds issued by the group's SPV Citrus Re, which provides multi-year reinsurance protection at a cost of $5.1 million.

Heritage had moved early on June 1 to brag of its programme closure amid reports that the mid-year renewals could turn bloody. Heritage had offered few to no details save the inclusion of the first cat bond since 2017.

Heritage partly attributed the programme’s success to its recent diversification, which the company notes has increased total insured value outside Florida to 74% of the total as of first quarter 2022, “with zero exposure to Louisiana and Texas.” Heritage was a 100% Florida carrier as recently as 2015.

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