14 October 2022Property and Casualty Acturial

Universal issues Hurricane Ian damage estimate

Florida-based Universal Insurance Holdings has estimated its overall gross ultimate loss from Hurricane Ian to be approximately $1 billion, well below its $3 billion overall reinsurance tower, with projected net exposure limited to retentions at its insurance and captive insurance entity subsidiaries.

Universal is a holding company offering property and casualty insurance and value-added insurance services. A detailed breakdown of its losses, including those suffered by its captives, is not yet available.

Hurricane Ian became a high-end Category 4 hurricane early on September 28, 2022, as it progressed towards the west coast of Florida, and made landfall just below peak intensity in southwest Florida on Cayo Costa Island, tying with several other storms as the 5th-strongest hurricane on record to make landfall in the US.

“Our thoughts are with all impacted Florida residents,” said Stephen J. Donaghy, chief executive. “We’re focused on helping our policyholders rebuild and return to normalcy. Our claims, catastrophe response and customer service teams are on the ground and on the phone, helping our policyholders in their time of need. With our dedicated staff, our disaster preparedness planning and conservative reinsurance program, we’re well prepared for this event and maintain substantial reinsurance protection for any subsequent events.”

According to Donaghy Universal has been serving the Florida market since 1998 and has experience across over a dozen hurricanes, including the highly active 2004-2005 seasons as well as recent major catastrophe events, including Hurricanes Irma and Michael in 2017 and 2018, respectively.

“Our strong reinsurance relationships have been formed over many years and we have access to our share of the FLOIR’s RAP layer of reinsurance coverage for the 2023-2024 renewal given that we deferred participation this year, on top of significant multi-year excess of loss catastrophe coverage that is part of next year’s program,” Donaghy said.

Universal said that at present it has received approximately 18,000 claims, roughly half the number of Hurricane Irma claims received at this point, and that its claims infrastructure, which includes over 800 claims, litigation and support professionals, has been able to handle the majority of Hurricane Ian claims in house.

While Universal’s overall Florida homeowners market share is approximately 7.9% based on the latest Florida residential industry total insured value (TIV) data, market share in Ian’s most intense wind path in the counties of Charlotte, Desoto, Lee and Sarasota is approximately 3.8%, the company said.

Additionally, Universal’s exposure to policies that provide roof and external structural coverage (e.g., landlord and traditional homeowners policies) in those four counties is only approximately 2.2%, with the balance of Universal’s market share in those counties reflecting renters and condo unit owners policies (only the interior and contents are covered).

Universal’s insurance companies, including its captives, do not provide flood insurance.