HCI Group to Acquire Insurance Business in Three Southeast States from United Insurance Holdings Corp.
December 16 2021 - 05:00PM
HCI Group, Inc. (NYSE:HCI), a
holding company with operations in homeowners insurance,
information technology services, reinsurance and real estate, has
reached an agreement in principle with
United Insurance
Holdings Corp. (NASDAQ: UIHC) to transition all of
United’s personal lines insurance business in the states of
Georgia, North Carolina, and South Carolina to HCI. The business to
be transitioned represents approximately $90 million of annual
premiums.
Under the agreement, HCI will provide 85% quota share
reinsurance on all of United’s in-force, new and renewal policies
in Georgia, North Carolina, and South Carolina from December 31,
2021 through May 31, 2022. In exchange, HCI will pay United a
provisional ceding commission of 25% of premium earned and that
percentage could increase up to 32% depending on the direct loss
ratio results for the reinsured business. HCI will also pay United
a catastrophe allowance equal to 9% of premium earned.
As part of the transaction, HCI will pay United a renewal rights
ceding commission of 6%, with a portion of the ceding commission
paid up-front. In connection with the transaction, United will
agree not to compete with HCI for the issuance of personal lines
for homeowners business in the three states until July 1, 2025.
The transaction is subject to negotiation of definitive
agreements and customary closing conditions, including receipt of
all applicable regulatory approvals.
“This transaction offers another great opportunity for HCI,”
said HCI Group Chairman and Chief Executive Officer Paresh Patel.
“HCI is expanding its relationship with United following a
successful transaction in the Northeast. This latest agreement
further accelerates HCI towards its growth ambitions, expands the
company’s footprint in existing and new states, and brings an
established agent network. HCI has the financial strength to
support and grow these new business opportunities.”
About HCI Group, Inc.HCI Group, Inc. owns
subsidiaries engaged in diverse, yet complementary business
activities, including homeowners insurance, reinsurance, real
estate and information technology services. HCI’s leading insurance
operation, TypTap Insurance Company, is a rapidly growing,
technology-driven insurance company that is expanding nationwide to
provide homeowners and flood insurance. TypTap’s operations are
powered in large part by insurance-related information technology
developed by HCI’s software subsidiary, Exzeo USA, Inc. HCI’s
largest subsidiary, Homeowners Choice Property & Casualty
Insurance Company, Inc., provides homeowners’ insurance primarily
in Florida. HCI’s real estate subsidiary, Greenleaf Capital, LLC,
owns and operates multiple properties in Florida, including office
buildings, retail centers and marinas.
The company's common shares trade on the New York Stock Exchange
under the ticker symbol "HCI" and are included in the Russell 2000
and S&P SmallCap 600 Index. HCI Group, Inc. regularly publishes
financial and other information in the Investor Information section
of the company’s website. For more information about HCI Group and
its subsidiaries, visit www.hcigroup.com.
Investor Relations Contact:Matt GloverGateway
Group, Inc. Tel 949-574-3860HCI@gatewayir.com
Media Contact:Jordan SchmidtGateway Group, Inc.
Tel 949-386-6332jordan@gatewayir.com
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