Chris Dittman, Executive Managing Director and Florida Practice Leader at broking group Aon, views the Florida property catastrophe reinsurance market as the healthiest and most stable it has ever been, pointing to stronger balance sheets, solid underwriting performance, increased capital levels, and continued stabilisation following recent reforms.
During AM Best’s Analytical Briefing on the state of the Florida property market, Dittman stated that the current environment in Florida is very healthy, both from an insurance and reinsurance perspective.
“I view this as the healthiest and most stable market I’ve seen in my years of doing business in Florida,” he said. “The balance sheets are solidified, driven by meaningful underwriting margins, reduced loss costs, and strong rate adequacy.”
Dittman continued, “Aon tracks 50 plus Florida focused personalised property carriers, and within that group, we’ve seen the statutory surplus levels grow from an aggregate of roughly $4.5 billion five years ago to over $9.2 billion this past year end. So, that’s meaningful growth in balance sheet strength. And this does not account for any of the profits that are generated by the carrier MGAs, the carrier reinsurance captives that take a lot of risk on their retentions, and by their affiliated TPAs. So, that growth in capital has really brought about stability to the portfolios for these carriers in terms of optimisation and re-underwriting efforts that we’ve seen in the past, causing policy churning and renewal attrition rates not holding up, so those are great.
“We’re seeing historically low leverage ratios from this composite group. In 2025, we ended with a 1.15 net written premium to surplus level, that’s the lowest we’ve seen in many years, and additionally, we saw a pretty dramatic spike in risk-based capital levels, growing from 450% at year end of 2023 to almost 690% at the end of 2025. So, meaningful growth in the balance sheet strength from a risk-based capital perspective.”
Lauren Magro, Senior Financial Analyst at AM Best, also spoke about how the Florida property market has become a healthier environment to operate in.
She highlighted specific indicators that led AM Best to conclude that Florida’s personal property insurance segment has truly entered a phase of stabilisation.
Magro said, “Aside from the considerable turnaround we’ve seen from an operating performance perspective, there’s several indicators and several elements that we’re looking at to indicate true stabilisation in the market. I mentioned the tort reform and the impact on DCC costs, that’s a real good indicator to us as to the expenses related to litigation that Florida insurers are exposed to that’s come down meaningfully in the years after the tort reform was passed, as well as the impact in the market dynamics, increased competition in the form of new entrants coming into the market. Even carriers who pulled back from Florida during times of volatility maybe have reemerged into the market and have resumed writing business in the state, all indicating that this is a healthier environment to write business in.
“The other thing that we are looking at, from a balance sheet perspective, is significant new capital generation. With overall change in surplus over the past five years, as compared to contributed capital, in 2025 over $1.5 billion surplus was grown by these Florida composite companies, yet only 21% of that was driven by contributed capital. If you look back on years like 2021 and 2022, that’s all outside capital being funnelled into the market, and insurers were still struggling to grow surplus, to even maintain surplus during those years. So, we’ve seen a meaningful shift after the reforms were put into place.”
She explained that insurers are now able to generate new capital through true operating earnings, indicative of stabilisation and improved operating performance driving improvements in balance sheet strength.
Magro added, “Lastly, while 2025 results did benefit from a benign hurricane year, you look back at 2024 to when the composite still reported a sizeable underwriting profit, and that was despite incurring losses from three major hurricanes that year. You had Hurricane Milton, Hurricane Helene, and Hurricane Debbie, significant damage caused throughout the state cumulatively from those events, and these insurers still turned a profit. So, that’s really proof that they’re able to remain profitable under pressure. It’s an indicator of true rate adequacy, it indicates that they are better able to absorb these losses now due to the changes in the operating environment, a renewed focus on underwriting discipline, risk management, risk selection, and overall just a healthier environment to operate in.”
During the call, Magro said the main takeaway is that Florida is a different place today than it was several years ago.
She noted, “The sustainability of the reforms appears to be there, but there will be challenges on the horizon. It’s not going to just be smooth sailing, because things are going well, and things went well in 2025. I think there are a lot of obstacles that insurers may face in the next few years.
“Underwriting discipline, maintaining effective risk management to be able to mitigate those challenges moving forward, maintaining conservatism in their business practices and in the decisions that these carriers and these Florida composite companies are making each day will go a huge way in the continued sustainability of the market.”
Guy Carpenter is the first of the brokers to report on the mid-year renewals, revealing that risk-adjusted property catastrophe pricing was generally down 15%–20% across many layers, and that Florida clients secured more than 12% additional reinsurance capacity compared with a year earlier.
The reinsurance broker said that Florida insurers renewing their reinsurance at the June renewals generally experienced favourable outcomes, driven by materially stronger balance sheets, improved underwriting performance, and sustained investor interest in Florida risk.
