CLEARWATER, Fla., June 5, 2017 /PRNewswire/ -- Heritage
Insurance Holdings, Inc. (NYSE: HRTG) ("Heritage" or the
"Company"), a property and casualty insurance holding company,
today announced that its insurance subsidiaries, Heritage Property
& Casualty Insurance Company ("Heritage P&C") and Zephyr
Insurance Company ("Zephyr") completed the placement of their
2017-2018 reinsurance programs. The programs are incorporated into
one reinsurance structure and are allocated amongst traditional
reinsurance, collateralized reinsurance, catastrophe bonds issued
by Citrus Re and coverage by the Florida Hurricane Catastrophe Fund
(FHCF). The new program provides first event reinsurance protection
for catastrophic losses of up to $1.75
billion in Florida and up
to $731 million in Hawaii, with multiple event coverage up to
$2.62 billion. This exceeds the
requirements established by the Company's rating agency, Demotech,
Inc., the Florida Office of Insurance Regulation and the Hawaii
Insurance Division.
Bruce Lucas, Chairman and CEO of
Heritage, said, "Our 2017 reinsurance treaty is a significant
improvement over the 2016 treaty. We have reduced catastrophe
reinsurance costs by over $20
million, or 8.3%, while improving treaty terms and
conditions. Notably, our first event retention was reduced from
$40 million to $20 million and our ground up retention for
second event coverage is $16 million.
We continue to minimize our reliance on state government sponsored
reinsurance and maintained our participation in the FHCF at 45%.
Our new program was placed on a cascading basis which provides
greater horizontal protection in a multiple small events scenario
and features additional coverage enhancements. In addition,
Heritage expanded its use of multi-year, fully collateralized
catastrophe bonds and has $687.5
million in catastrophe bond coverage today."
The Company's estimated net cost for the 2017-2018 catastrophe
reinsurance program is approximately $223
million. The total estimated cost for per risk and
facultative coverage is projected to be an additional $7 million. The primary factors causing the
decrease from last year are the proactive exposure management
executed by the Company over the past 12 months coupled with
significantly improved pricing.
About Heritage
Heritage Insurance Holdings, Inc. is a property and casualty
insurance holding company headquartered in Clearwater, Florida. Its subsidiaries,
Heritage Property & Casualty Insurance Company and Zephyr
Insurance Company, write approximately $565
million and $58 million,
respectively, of personal and commercial residential premium
through a large network of experienced agents. The Company is
currently writing property and casualty insurance policies in
Florida, Hawaii, North
Carolina, South Carolina
and Georgia. Heritage Insurance
Holdings, Inc. is led by a seasoned senior management team with an
average of 30 years of insurance industry experience.
Forward-Looking Statements
Statements in this press release that are not historical facts
are forward-looking statements that are subject to certain risks
and uncertainties that could cause actual events and results to
differ materially from those discussed herein. Without limiting the
generality of the foregoing, words such as "may," "will," "expect,"
"believe," "anticipate," "intend," "could," "would," "estimate,"
"or "continue" or the other negative variations thereof or
comparable terminology are intended to identify forward-looking
statements. The risks and uncertainties that could cause our actual
results to differ from those expressed or implied herein include,
without limitation: the success of the Company's marketing
initiatives; inflation and other changes in economic conditions
(including changes in interest rates and financial markets); the
impact of new federal and state regulations that affect the
property and casualty insurance market; the costs of reinsurance
and the collectability of reinsurance; assessments charged by
various governmental agencies; pricing competition and other
initiatives by competitors; our ability to obtain regulatory
approval for requested rate changes, and the timing thereof;
legislative and regulatory developments; the outcome of litigation
pending against us, including the terms of any settlements; risks
related to the nature of our business; dependence on investment
income and the composition of our investment portfolio; the
adequacy of our liability for losses and loss adjustment expense;
our ability to build and maintain relationships with insurance
agents; claims experience; ratings by industry services;
catastrophe losses; reliance on key personnel; weather conditions
(including the severity and frequency of storms, hurricanes,
tornadoes and hail); changes in loss trends; acts of war and
terrorist activities; court decisions and trends in litigation; and
other matters described from time to time by us in our filings with
the Securities and Exchange Commission, including, but not limited
to, the Company's Annual Report on Form 10-K for the year ended
December 31, 2016 filed with the
Securities and Exchange Commission on March
15, 2017. The Company undertakes no obligations to update,
change or revise any forward-looking statement, whether as a result
of new information, additional or subsequent developments or
otherwise.
Heritage Insurance Holdings Inc.
Investor
Contact:
Steve Martindale
Chief Financial Officer
727-362-7203
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SOURCE Heritage Insurance Holdings, Inc.