{"id":529,"date":"2025-05-30T12:30:02","date_gmt":"2025-05-30T12:30:02","guid":{"rendered":"http:\/\/www.atsnorfolk.com\/?p=529"},"modified":"2025-06-04T14:13:55","modified_gmt":"2025-06-04T14:13:55","slug":"florida-carriers-entered-mid-year-2025-renewals-from-stronger-footing-am-best","status":"publish","type":"post","link":"http:\/\/www.atsnorfolk.com\/index.php\/2025\/05\/30\/florida-carriers-entered-mid-year-2025-renewals-from-stronger-footing-am-best\/","title":{"rendered":"Florida carriers entered mid-year 2025 renewals from stronger footing: AM Best"},"content":{"rendered":"

This content is copyright to www.artemis.bm<\/a> and should not appear anywhere else, or an infringement has occurred.<\/p>\n

Florida\u2019s specialist personal property insurers entered the key 2025 mid-year reinsurance renewals from a position of relative strength, following improved profitability and more favourable operating conditions, according to a new report from credit ratings agency AM Best.
\n<\/span>
\n\"Florida\u201cLooking ahead to midyear renewals, the balance of power appears to be shifting toward primary carriers,\u201d said Chris Draghi, director at AM Best.<\/p>\n

\u201cGiven that loss activity has been more moderate in recent years and profitability has stabilized, Florida composite companies are now in a better position to manage risk accumulation and potentially negotiate more favorable terms with reinsurers,” Draghi added.<\/p>\n

The comments stem from the agency\u2019s latest Best\u2019s Market Segment Report, which outlines how Florida\u2019s personal property insurance market recorded an underwriting profit of $206.7 million in 2024, a sharp turnaround from the $174.4 million underwriting loss reported the year before.<\/p>\n

As well as this, pre-tax operating income reached $492.3 million, up from near breakeven in 2023. While the composite\u2019s combined ratio improved to 93.1% for the year continuing a five-year trend of year-over-year gains driven by tighter underwriting, better exposure management, and legislative reforms.<\/p>\n

The report also noted the significant impact of 2024\u2019s hurricane season, including Hurricane Milton, with estimated insured losses of $17.2 billion; Hurricane Helene, under $2 billion; and Hurricane Debbie, at $121 million.<\/p>\n

Despite these events, the Florida personal property composite turned a profit, \u201cdemonstrating the resilience of the marketplace,\u201d AM Best wrote, adding: \u201cFlorida\u2019s property insurance and reinsurance markets have been navigating a complex landscape in recent years shaped by hurricanes, legislative reforms, and evolving market dynamics.\u201d<\/p>\n

\u201cHow the improvement in performance translates into potential cost savings and capacity availability at the upcoming mid-year renewal season remains to be seen.\u201d<\/p>\n

Furthermore, for insurance-linked securities (ILS) and catastrophe bond market participants, the improved underwriting fundamentals present a clearer picture of risk and potentially greater predictability around future issuance and loss performance.<\/p>\n

Several Florida-focused catastrophe bonds have already come to market in 2025, led by the $1.525 billion Everglades Re II (Series 2025-1)<\/a> placement by Citizens Property Insurance Corporation in early May, which at the time was the largest cat bond issuance on record.<\/p>\n

The report also underscores just how heavily Florida carriers rely on reinsurance. AM Best cites a ceded reinsurance leverage ratio of 519.4% for active Florida property insurers in 2024, which is far above the 62.2% U.S. composite average, highlighting the continued importance of third-party capital to support underwriting across the state.<\/p>\n

\u201cFlorida\u2019s legislative reforms acted as a material tailwind for longstanding participants but also improved the environment to attract new entrants, effectively increasing capacity,\u201d said Josie Novak, senior financial analyst at AM Best.<\/p>\n

This includes more recent 2025 session measures that aim to expand access to the E&S market, particularly for seasonal homes insured by highly rated carriers.<\/p>\n

Novak added: \u201cAdditionally, the retreat of certain carriers\u2014whether through reduced market participation or the suspension of new business\u2014has created space for new companies to establish a foothold, further reshaping the competitive landscape.\u201d<\/p>\n

Despite the improved conditions, the exposure profile for Florida specialists remains materially higher than national averages. Insurers reported a direct premiums written-to-surplus ratio of 3.2x, versus a U.S. average of 1.7x, underscoring the state\u2019s outsized catastrophe risk and structural reinsurance dependence.<\/p>\n

Still, with reinsurance markets softening and capital market solutions playing a growing role, Florida carriers may find themselves with more room to manoeuvre in 2025, particularly as they look to optimise program structure, manage retention levels, and secure cost-effective tail protection via the cat bond market.<\/p>\n

Two insurers with significant Florida presence reported on the outcomes of their reinsurance renewals recently, with American Integrity Insurance Company securing a meaningful $799 million increase in reinsurance<\/a> limit this year, while Universal Insurance Holdings, Inc. bought $110 million more in reinsurance limit at its 2025 renewal<\/a>, both with the ILS market playing significant roles as counterparties.<\/p>\n

Separately, Howden Re reported that risk-adjusted property catastrophe reinsurance rates ranged from flat to down 20% at the June 1 renewal<\/a>.<\/p>\n

Read all of our news and analysis on the Florida insurance and reinsurance market<\/strong><\/a>.<\/strong><\/p>\n

Florida carriers entered mid-year 2025 renewals from stronger footing: AM Best<\/a> was published by: www.Artemis.bm<\/a>
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This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred. Florida\u2019s specialist personal property insurers entered the key […]<\/p>\n","protected":false},"author":1,"featured_media":531,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-529","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-reinsurance-renewals"],"_links":{"self":[{"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/posts\/529","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/comments?post=529"}],"version-history":[{"count":2,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/posts\/529\/revisions"}],"predecessor-version":[{"id":532,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/posts\/529\/revisions\/532"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/media\/531"}],"wp:attachment":[{"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/media?parent=529"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/categories?post=529"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.atsnorfolk.com\/index.php\/wp-json\/wp\/v2\/tags?post=529"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}