Mac Armstrong, CEO of Palomar Holdings, expressed satisfaction with the outcomes of the company’s reinsurance treaties renewing on January 1 during the Q4’23 earnings call.
Armstrong stated, “As it pertains to our Reinsurance program, we are pleased with the outcome for our reinsurance treaties renewing January 1.”
Armstrong highlighted that while only a select few treaties renewed at the start of the year, including a commercial earthquake quota share, a small earthquake-only excess of loss layer, and a casualty quota share, they provided valuable insights into the market landscape.
The renewed earthquake quota share and XOL layer both saw improved economics, resulting in risk-adjusted decreases of approximately 5%.
Additionally, the casualty quota share witnessed improved economics with an increased ceding commission compared to the expiring level.
Looking forward, Armstrong mentioned the company’s cautious approach, stating, “While the outlook for reinsurance has certainly improved from a year prior, we are conservatively budgeting for modest price increases in our June 1 renewal.”
However, Armstrong expressed confidence in the market’s trajectory, saying, “We are confident the apex of a historically hard market is behind us, which bodes well for net earned premium growth and margin expansion.”
For the full year 2023, Palomar posted net income of $79.2 million, compared with $52.2 million in 2022.
