We thank Fitch Ratings for sharing their newly released report with our audience. The report says the industry is well positioned for another large catastrophe event:
Key points include:
- Aggregate U.S. industry policyholders’ surplus grew to $757 billion at YE18, despite 2018 cat losses of $15bn for Hurricanes Florence and Michael
- Florida’s state sponsored (re)insurance entities Citizens Property Insurance and Florida Hurricane Catastrophe Fund have balances of $6.2bn and $12.4 bn respectively at YE18
- Florida homeowners insurance pricing should improve after years of increases due to Assignment of Benefits (AOB) reform.
- Use of alternative reinsurance capital is rising with the prospect of improved returns, although use of traditional reinsurance remains more prominent
- Desire for alternative capital and low interest rates have helped grow cat bond issuance