Two Florida-based property casualty insurers are pursuing expansion plans, following an M&A deal by a third instate rival to do the same.

Heritage Insurance Holdings said it has agreed to snatch up Hawaii-based Zephyr Acquisition Company and its subsidiary, specialty insurer Zephyr Insurance Company, for $120 million in cash. The deal, expected to close in the 2015 fourth quarter, gives Heritage an instant, dominant presence in the state; Zephyr holds about 30 percent of the wind-only market share in Hawaii.

By doing the deal, Heritage gets to diversify, achieve greater reinsurance synergies and expand outside of Florida. Zephyr’s inforce premium was nearly $68 million as of the period ending June 30. The insurer launched in 2000 and writes wind-only insurance coverage for personal residential and commercial residential policyholders. It also has solid capital structure boosted by its reinsurance program with a number of prominent reinsurers. Demotech gives Zephyr an A rating,

Heritage subsidiary Heritage Property & Casualty Insurance company writes more than $500 million in personal and commercial residential premium through a large agent network.

The deal comes as Florida-based United Insurance Holdings Corp. (UPC Insurance) said it will pay $57 million for Interboro Insurance Company, a New York-baed regional property/casualty insurer also licensed to operate in Washington, D.C. as well as Louisiana, Alabama and South Carolina. UPC has also pursued other expansions going back to 2014.

At the same time, Florida’s Universal Insurance Holdings is expanding into West Virginia. Its subsidiary, Universal Property & Casualty Insurance Company (UPCIC) gained approval from the West Virginia Offices of the Insurance Commissioner to do business in the state. UPCIC also writes homeowners insurance in Florida, North Carolina, South Carolina, Hawaii, Georgia, Massachusetts, Maryland, Delaware, Indiana, Pennsylvania, Michigan, Minnesota, Virginia and Alabama.

Sources: UCIC, Heritage Insurance Holdings

Topics Florida Carriers Virginia Hawaii Property Casualty