HCI Group has reported a net loss of $51.5 million in the third quarter of 2022, compared to a net loss of $4.9 million from the third quarter of 2021.
At the same time, the company’s net loss for the year so far currently stands at $57.3 million compared to a net income of $5.8 million from the same period last year.
Consolidated gross written premiums (GWP) of $191.2 million increased from $174.3 million in the third quarter of 2021. Homeowners Choice GWP of $119.4 million increased from $118.3 million and TypTap Insurance Company GWP also grew to $71.8 million from $56 million.
Additionally, consolidated gross premiums earned of $181.7 million increased 21.3% from $149.8 million from the same period last year, while Homeowners Choice gross premiums earned grew to $99 million from $98.3 million, and TypTap gross premiums earned grew to $82.7 million from $51.5 million.
Meanwhile, premiums ceded for reinsurance of $74.7 million increased from $55.6 million in the quarter. HCI Group noted that this was primarily due to the growth of both Homeowners Choice and TypTap and a $12.6 million adjustment to reduce benefits under a multi-year reinsurance contract with retrospective provisions as a result of Hurricane Ian.
Ceded premiums represented 41.1% and 37.1% of gross premiums earned in the third quarters of 2022 and 2021, respectively.
Furthermore, HCI Group’s reported $139.8 million in losses and loss adjustment expenses for the quarter, which was an increase from $62.7 million in the same period of 2021. The increase in losses and loss adjustment expenses was primarily due to Hurricane Ian.
HCI Group Chairman and Chief Executive Officer Paresh Patel, commented: “Our deepest sympathies go out to those who have been impacted by Hurricane Ian. We responded swiftly to the storm, marshaling the resources of our entire organization. Our execution highlights the investments we’ve made in technology and our ability to deliver on our commitment to policyholders.
“Claims from Ian remain consistent with views we disclosed in October. We have adequate reinsurance to cover Ian claims and liquidity to support our business and growth plans. Excluding Ian, our insurance divisions produced solid results this quarter as gross premiums grew more than 20% and our gross loss ratio improved to 41.4%, a decline of 6.5 points from second quarter 2022. Ian underscores the value of homeowners insurance and the importance of a healthy insurance industry.”