U.S. Hurricane Season 2019

Overview

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

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