Florida based primary insurer FedNat is anticipating catastrophe losses in the second quarter to reach $48.3 million, net of all recoveries, including reinsurance.
These catastrophe losses were driven by severe weather events that occurred during the second quarter in states in which the company does business, including Florida ($21.5mn), Texas ($14.6mn) and Louisiana ($11.3mn).
More specifically, during the quarter there were fourteen Property Claims Service events, including Tropical Storm Cristobal, plus a Florida Panhandle wildfire
Additionally, in the second quarter, the company expects to strengthen reserves for prior accident years by $7.5 million, pre-tax, related primarily to the 2019 accident year in the Florida homeowners line of business.
FedNat adds that it continues to file for rate increases to ensure its rates better reflect the increased costs related to claims activity and costs of reinsurance.
The company has recently received regulatory approvals for several rate increases, including a 7.4% statewide- average increase on FedNat’s Florida homeowners business that took effect on June 15, 2020.
FNIC has also filed for a 5.6% statewide-average Florida increase related to the cost of catastrophe reinsurance.
FNIC has also filed for statewide-average rate increases of over 9.5% on its homeowners business in Texas and Louisiana.
Maison Insurance Company also recently filed for a 15.9% Louisiana homeowners statewide-average rate increase.
FedNat is currently restricting new business throughout Florida during wind season and until our approved rates more accurately reflect our increased claims costs.