Florida Citizens news

Florida’s Citizens Property Insurance Corporation’s risk transfer and reinsurance buying strategy continues to evolve, with the insurer electing to renegotiate multi-year aggregate reinsurance and shift the protection to per-occurrence coverage for the 2016 hurricane season.

Florida’s Citizens Property Insurance Corporation has reset its most catastrophe bond, the $300m Everglades Re II Ltd. (Series 2015-1) transaction, at a lower attachment point, reacting to the effects of depopulation of its portfolio and looking ahead to its reinsurance and risk transfer needs.

The steep decline in rates and pricing for Florida wind property catastrophe reinsurance coverage can be plainly seen in information published by the states Citizens Property Insurance Corporation. Also published are the extent of the savings the insurer made in 2015.

Citizens has lined itself up with the best protection in its history for 2015, with a risk transfer, reinsurance and catastrophe bond programme that eliminates the need for Florida policyholder assessments right up to a 1 in 100 year storm.

Florida’s Citizens latest Everglades Re II Ltd. (Series 2015-1) catastrophe bond has now been priced. The cat bond has now upsized by 20% to $300m, while the final pricing almost reached the top of the expanded guidance, as Citizens finalised a $3.9B risk transfer programme for 2015.

According to sources the price guidance for Florida’s Citizens latest Everglades Re II Ltd. (Series 2015-1) catastrophe bond has been expanded, providing a wider range of possible coupon yield after investors pushed back on the tight launch pricing range.

Florida’s Citizens Property Insurance Corporation is back with the expected Everglades Re II Ltd. (Series 2015-1) catastrophe bond in advance of the U.S. hurricane season, as the insurer seeks to once again increase its use of capital markets for risk transfer.

Florida’s Citizens Property Insurance Corporation hopes to see ‘relatively better pricing’ in its risk transfer programme for 2015, including in a new catastrophe bond expected to come to market via a new issuing vehicle, Everglades Re II Ltd.

As we wrote back in December, the Board of Florida Citizens approved sponsoring another Everglades Re Ltd. catastrophe bond as part of its 2015 risk transfer program, which will seek around $4.05 billion of reinsurance protection for the insurer.

The Board of Citizens Property Insurance Corporation of Florida has approved the use of its Everglades Re Ltd. vehicle for another catastrophe bond issuance in 2015, as the insurer looks to secure reinsurance and risk transfer to cover a 1-in-100 year hurricane.