Florida’s Citizens Property Insurance Corporation has revealed it has placed its 2026 private risk transfer program of $2.82 billion.
Of the total, approximately $691 million is in the traditional reinsurance market and $2.13 billion in the capital markets, resulting in an overall weighted-average net rate-on-line (ROL) of 9.52%.
The program comprises $1.29 billion of new 2026 placement and $1.53 billion of multi-year coverage carried forward from 2025.
The new placement includes $691 million in traditional reinsurance and $600 million in capital markets, and carries a net ROL of 8.46%, down 29.2% from the 11.95% achieved on the 2025 new placement.
“For the total program including existing coverage, the price is approximately 20% lower than the 2025 program and for new coverage placed in 2026, the price is approximately 30% lower than it would have cost for similar coverage in 2025,” Citizens explained.
According to Citizens, cost savings for the 2026 program are attributed to the early redemption of three tranches of notes through Everglades Re II issued in 2024.
“This option, available since Citizens’ exposure decreased by more than 75% over two years, enabled replacement of coverage in favourable market conditions as the prices have decreased significantly,” Citizens said.
The firm continued, “Nonetheless, even after paying an optional redemption premium of $5.5 million, the resulting savings are significant.
“The cost to retain the coverage through Everglades 2024-1 notes for the third and final year would have been $124.8 million as compared to the Everglades 2026-1 cost of $46.6 million for net savings of $72.7 million. The savings are a result of reduced coverage as well as reduced ROL.”
As reported by our sister publication Artemis, Citizens returned to the catastrophe bond market in May and secured $600 million of reinsurance protection through the Everglades Re II Ltd. (Series 2026-1) issuance.
This brought its outstanding catastrophe bond coverage to $2.125 billion, where it currently stands according to Artemis’ catastrophe bond sponsor leaderboard.
Read more on the above and explore full details of every catastrophe bond issued by Florida Citizens in the Artemis Catastrophe Bond & Insurance-Linked Securities Deal Directory.
As previously noted, the 2026 risk transfer program builds on the structure of prior years, incorporating key strategic elements.
These include transferring risk in coordination with the FHCF, as well as ceding both single-occurrence and annual aggregate risk.
The aim is to protect a portion of surplus against the most severe events and, in doing so, eliminate the likelihood of policyholder surcharges or emergency assessments for Florida residents in the event of a 1-in-100-year catastrophe.
The chart below shows Citizens’ preliminary risk transfer tower.
As per Citizens. the Sliver Layer will sit alongside the FHCF. It provides $160 million, in excess of $1.05 billion, of annual per occurrence coverage, which covers personal residential and commercial residential losses. This layer, placed in the traditional market, would work in tandem with the mandatory coverage provided by the FHCF.
Layer 1 will sit above the Sliver Layer and the FHCF. This layer is a capital markets renewal risk transfer placement of $225 million of coverage for personal residential and commercial residential losses through Everglades Re II. This is the second year for this multi-year Note (originally placed in 2025), which provides aggregate coverage.
Layer 2 provides $850 million of coverage for personal residential and commercial residential losses from the capital and traditional reinsurance markets. It features $250 million of occurrence coverage from the traditional market, as well as $225 million of new multi-year, annual aggregate coverage from the capital markets placed through Everglades Re II in 2026, and $375 million from the 2025 Everglades Re II cat bonds.
Layer 3 provides another $850 million of coverage from cat bonds and reinsurance, with $175 million of occurrence coverage from the traditional market, $200 million from the new Everglades Re II 2026 cat bonds, and $475 million from the 2025 cat bond sponsorship.
Layer 4 provides $731 million of cover from reinsurance and capital markets, including $106 million of occurrence coverage from the traditional market, $175 million from the new 2026 cat bonds, and $450 million from the 2025 cat bonds.
Alongside all this, Citizens provided a market overview highlighting how 2026 further solidified the impact of the 2022 and 2023 litigation reforms on Florida’s risk transfer marketplace.
It said, “After a year of development from Hurricanes Helene and Milton, and no Florida hurricane landfall for the first time in a decade, reinsurers entered 2026 with a desire to build on the 2025 price decreases.
“Both the catastrophe bond market and the traditional reinsurance market have ample capacity due to increased capital, improved earnings, and renewed confidence in the Florida market.
“This is reflected in Citizens’ new 2026 placement of approximately half in capital markets and the other half in traditional markets. Depending on the placement and cedent, overall rate reductions in Florida at the June 1 renewal are in the range of approximately 15-20% for layers above the FHCF.”
Gallagher Re acted as Citizens’ traditional reinsurance broker, while its capital markets co-underwriting team comprised Aon Securities and GC Securities, with Raymond James serving as financial advisor.
