TAMPA,
Fla., June 6, 2022 /PRNewswire/ -- Heritage
Insurance Holdings, Inc. (NYSE: HRTG) ("Heritage" or the
"Company"), a super-regional property and casualty insurance
holding company, announced today details regarding the placement of
its 2022-2023 catastrophe reinsurance program for its statutory
insurance subsidiaries, including Heritage Property Casualty
Insurance Company, Narragansett Bay Insurance Company and Zephyr
Insurance Company.
2022-2023 catastrophe reinsurance
program key points:
- Total consolidated cost of approximately $359.5 million, accounting for 31% of
March 31, 2022, premiums-in-force,
three points higher than the prior year cost which accounted for
28% of March 31, 2021
premium-in-force.
- First event reinsurance tower exhaustion points of $1.2 billion for the Northeast, $1.3 billion in the Southeast and $780.0 million in Hawaii with no co-participations in the
syndicated program.
- Program and costs include a limit of $100 million from catastrophe bonds issued by our
special purpose vehicle, Citrus Re Ltd., which provides multi-year
reinsurance protection at a cost of $5.1million.
- First event consolidated loss retention in the Southeast and
Hawaii of $40.0 million, and $30.0
million in the Northeast. Individual Insurance companies
will be less given the use of captive Osprey Re.
- Entire program is indemnity based.
- Florida Hurricane Catastrophe Fund participation of 90%,
consistent with the prior year program.
- Deferred the use of Reinsurance to Assist Policyholders (RAP)
program created by the Florida
legislature.
"We are pleased to have completed our catastrophe reinsurance
program integrating indemnity-based traditional reinsurance and
insurance-linked securities. Our longstanding
relationships with existing reinsurers as well as going to the
market early contributed to the success of our placement. I
was also pleased that the Company's program had reached a level of
maturity making the new RAP program unnecessary to complete
the risk transfer. Our super-regional strategy allowed for an
orderly placement with our partners in these markets despite
deteriorating capacity for Florida
risk."
In addition, Heritage proactively suspended the offering of new
personal residential policies in various counties in Florida, effective June
3, 2022, as the Company evaluates the impact of recent
legislation on the homeowner's insurance marketplace and awaits
other meaningful and necessary legislative changes in
Florida. The Company anticipates that the suspension will be
temporary as it is dedicated to the Florida market but will continue to evaluate
options and the overall strategy in Florida which could entail additional
suspensions or openings.
Financial information, including material announcements about
Heritage, is routinely posted on investors.heritagepci.com.
About Heritage
Heritage Insurance Holdings, Inc. is a super-regional property
and casualty insurance holding company. Through its insurance
subsidiaries and a large network of experienced agents, the Company
writes approximately $1.2 billion of
gross personal and commercial residential premium across its
multi-state footprint.
Forward-Looking
Statements
Statements in this press release that are not historical facts
are forward-looking statements that are subject to certain risks
and uncertainties that could cause actual events and results to
differ materially from those discussed herein. Without limiting the
generality of the foregoing, words such as "may," "will," "expect,"
"believe," "anticipate," "intend," "could," "would," "estimate,"
"or "continue" or the other negative variations thereof or
comparable terminology are intended to identify forward-looking
statements. This release includes forward-looking statements
relating to the benefits of our 2022-2023 catastrophe reinsurance
program, the impact of our strategic initiatives, and our
suspension of offering of new personal residential policies in
various counties in Florida, the
temporary nature of such suspension, the impact of Florida legislation, and our overall strategy
in Florida.. The risks and
uncertainties that could cause our actual results to differ from
those expressed or implied herein include, without limitation: the
success of the Company's underwriting and profitability
initiatives; the continued and potentially prolonged impact of the
COVID-19 pandemic on the economy, demand for our products and our
operations; inflation and other changes in economic conditions
(including changes in interest rates and financial and real estate
markets), including as a result of the COVID-19 pandemic; the
impact of macroeconomic and geopolitical conditions, including the
impact of supply chain constraints, inflationary pressures, labor
availability and the conflict between Russia and Ukraine; the impact of new federal and state
regulations that affect the property and casualty insurance market;
the costs of reinsurance, the collectability of reinsurance and our
ability to obtain reinsurance coverage on terms and at a cost
acceptable to us; assessments charged by various governmental
agencies; pricing competition and other initiatives by competitors;
our ability to obtain regulatory approval for requested rate
changes, and the timing thereof; legislative and regulatory
developments; the outcome of litigation pending against us,
including the terms of any settlements; risks related to the nature
of our business; dependence on investment income and the
composition of our investment portfolio; the adequacy of our
liability for losses and loss adjustment expense; our ability to
build and maintain relationships with insurance agents; claims
experience; ratings by industry services; catastrophe losses;
reliance on key personnel; weather conditions (including the
severity and frequency of storms, hurricanes, tornadoes and hail);
changes in loss trends; acts of war and terrorist activities; court
decisions and trends in litigation; and other matters described
from time to time by us in our filings with the Securities and
Exchange Commission, including, but not limited to, the Company's
Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and
Exchange Commission on March 14, 2022
and subsequent filings. The Company undertakes no obligations to
update, change or revise any forward-looking statement, whether as
a result of new information, additional or subsequent developments
or otherwise.
Investor Contacts:
Kirk
Lusk
Chief Financial Officer
klusk@heritagepci.com
Mike Houston
Lambert
HRTG@lambert.com
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SOURCE Heritage Insurance Holdings, Inc.