Florida’s Citizens Property Insurance Corporation has completed placement of its 2023 risk transfer program, securing more than $2.98 billion in protection from a mix of traditional and collateralized reinsurers for accounts in Coastal and Personal Lines (PLA), where over $1 billion was earned. from Berkshire Hathaway
As well as $2.98 billion in reinsurance from the traditional market, Citizens has roughly $2.4 billion in catastrophe bond protection in place, meaning the company has secured an estimated $5.38 billion in risk transfer for 2023.
This year’s placement is worth nearly $650 million. Previously, the Board approved citizens to seek a total of $5.644 billion in coverage at a cost not exceeding $675 million, so the insurer obtained slightly less protection than it was authorized, but at a cost of $25 million less top-end. in the budget.
Citizens explained that the $5.38 billion in protection it obtained includes $4.23 billion in new placement and $1.150 billion in existing, multi-year coverage from 2021 and 2022.
What is remarkable about this year’s change is the $2.98 billion in new protections that came from the traditional market, a significant $1 billion, more than a third, from Berkshire Hathaway. This is for the Citizens PLA layer, which overall Citizens got $1.644 billion in new protection for mid-year renewals, meaning Berkshire took the lion’s share (60%) of this account that never joined in 2022.
Other reinsurers participating in this layer include Everest Re, Odyssey Re, TransRe, Swiss Re America, Lancashire, PartnerRe, Hannover Re, and SiriusPoint. Via Gallagher Re, Ascot Bermuda, Eskatos, Lloyds Syndicate 1414 – Ascot, and Lloyds Syndicate 2791 – MAP also participated.
Collateralised reinsurers also participated in this layer, including Aeolus Capital Management Ltd., DE Shaw Re (Bermuda) Ltd., Leadenhall Capital Partners, LGT Capital (obo Lumen Re Ltd., Longtail Re (Stoneridge), and Nephila Capital.
In fact, after domestic reinsurers, which are again led by Berkshire but in total put almost $1.15 billion in the PLA layer, collateralized reinsurers put the most at $418.7 million.
In terms of the Coastal Account layer in the 2023 renewal, collateralized reinsurers led the way in putting $772.9 million out of a total of $1.336 billion for the account. Here, Nephila led the way with a whopping $634 million, taking the company’s total placement to $756 million.
Berkshire Hathaway did not participate in this layer, with Munich Re taking the largest chunk of the program outside of Nephila, at nearly $119 million.