Primary players Heritage Insurance Holdings, Inc. and United Insurance Holdings (UPC Insurance) have reported their Q2 2019 catastrophe losses, with Heritage experiencing higher impacts than the prior year, while United (UPC) has reported in-line current year impacts but further loss creep from 2018.
Heritage said that it expects to report $21.5 million of net weather-related losses due to second quarter 2019 events, a figure that means its reinsurance won’t be particularly (if at all) troubled by the severe weather activity.
This is largely from four wind and hail storm events that struck the southeast United States.
Compared to 2018 the Q2 cat loss figure is much higher, at more than double the $9.4 million of net weather-related losses Heritage reported for the second quarter of 2018.
FedNat Holding Company had also reported $17 million of gross catastrophe losses for the second-quarter of 2019, which is not expected to impinge on its reinsurance program.
United (UPC) bucked the trend though, by reporting today that on top of second-quarter losses experienced this year, it is also expected to dent its Q2 results with further loss creep.
United UPC said it expects approximately $16 million of net retained catastrophe losses, largely caused by wind and hail events occurring in Texas and Louisiana.
But the insurer also added that it experienced roughly $15 million of adverse reserve development (loss creep) from 2018, made up of both catastrophe and non-catastrophe losses primarily occurring in Florida.
It’s likely some of this will be loss creep associated with hurricane Michael, an event that is now being closed watched for loss creep by insurance and reinsurance market participants alike.
There’s a very good chance that United’s (UPC) quota share and other reinsurance partners could have assisted with some of this loss creep, given the 2018 tower was already being eaten into, while the fresh Q2 2019 loss experience is unlikely to have made much of a dent in United’s robust reinsurance provisions.
View all of our Artemis Live video interviews and subscribe to our podcast.
All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.
Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.