Florida headquartered primary carrier Universal Insurance has announced a total revenue of $262.8 million for the first quarter of 2021, an increase of 11.7% from the prior year period.
Direct premiums written were up 9.2% for the quarter, led by direct premium growth of 10.2% in Florida.
On the expense side, the combined ratio improved by a point to 93.4%.
The improvement was driven primarily by decreased weather, favourable prior year’s reserve development, and an increased benefit from our claims adjusting business, partially offset by higher reinsurance costs impact on the ratio and current year strengthening.
Net investment income decreased 56.3%, largely due to significantly lower yields on the reinvested portfolio following the sale of a majority of securities in the portfolio that were in an unrealised gain position in the third and fourth quarters of 2020.
“We are off to a strong start to 2021 with solid first quarter results, including close to 12% top line growth, margin expansion in excess of 200 basis points, and a total annualised return on average equity of 23.2%,” said Stephen J. Donaghy, Chief Executive Officer.
“We continue to make progress on our reinsurance program renewal, and we’re oversubscribed on our first CAT bond in March at rates below the low end of our initial range. We have now completed procurement of our All States first event reinsurance program for UPCIC for the 2021 wind season and will have additional details in May as we finalise the remainder.
“In addition, we were encouraged earlier this month when the Florida Senate passed Bill 76, which would enable Floridians to have reliable access to property insurance.
“For a number of years Florida has been a significant outlier compared to the rest of the country when it comes to litigated property claims, which has put significant pressure on the Florida property insurance marketplace.
“We have not been immune to these market dynamics and during the first quarter we actively reduced our policies in force sequentially and reduced new and renewal policy counts in aggregate this quarter when compared to the first quarter of 2020. That being said, we continue to monitor closely the companion bill in the House (House Bill 305), which has differences from Senate Bill 76.”