Reinsurance News

Florida-focused property insurance company FedNat Holding Company has announced that it has secured a $15 million investment into its Monarch National Insurance Company subsidiary, which will now assume the rest of the group’s Florida policies.

Florida’s insurance carriers face one problem above all others, the fact that they are over-litigated and being badly affected by a litigious property insurance claims environment where fraud has been de rigueur.

The June 1st Florida focused reinsurance renewals are expected to be very late, but prospects for rate increases are said to be particularly good, as analysts at KBW said they expect Florida property catastrophe rate increases well above the January 1, 2022 renewals’ low double-digit pace.

Florida’s Legislature made progress on some of the property insurance reform bills that were heard by a committee yesterday, moving them on to the Senate, but the details underlying the reforms will matter for the reinsurance market and the prospects of meaningful change.

While the overall Bermudian reinsurance and insurance-linked securities (ILS) market is still in the early stages of its environmental, social and governance (ESG) journey but making steady progress, there is work to do on protection gap related issues, as the Bermuda market lags behind competitors, a new report suggests.

Driving home the seriousness of the situation in Florida’s property insurance market today, the sponsor of one of the bills being discussed at the special legislative session in Tallahassee said on the floor that some carriers in the state are “on life support.”

Southern parts of the Canadian provinces of Ontario and Quebec have been hit by a line of severe thunderstorms, in a Derecho type event that has caused widespread and relatively significant damage across the region.

Industry contacts have been raising concerns over the weekend, that proposed property insurance related legislation set to be raised during Florida’s special session of the legislature this week will not go far enough on litigation and won’t do enough to bring reinsurance market confidence back to the state.

The global insurance and reinsurance market faces a range of challenges, but at the same time the opportunities for the sector and for the provision of efficient capital to absorb societal risks, is also expanding, with PwC estimating that the global protection gap may expand to US $1.86 trillion by 2025.

Amid the increased frequency, scope, and severity of natural catastrophes, insurance-linked securities (ILS) investors stand to benefit from the greater predictability and sustainability of non-nat-cat program-based portfolios of risk, according to AM RE Syndicate.