US gadget and lender-placed homeowners carrier Assurant has secured a $1.3bn of property catastrophe cover for 2018, the insurer has announced.
The carrier said it paid $121mn for the cover marking a 4 percent saving on last years programme reflecting its dwindling catastrophe exposure.
It said the policy was written by more than 40 reinsurers that all have an AM Best rating of A- or better.
Assurant maintained a $120mn retention on its US property tower, which has limits of $1.11bn.
The insurer said that the cover protected its probable maximum loss for a 1-in-170-year storm. It added that multi-year contracts covering 32 percent of the $855mn xs $240mn layer.
All layers of the programme are top-and-drop and allow for one automatic reinstatement.
Meanwhile, it has a separate tower for the Sunshine State backed by the Florida Hurricane Catastrophe Fund. For that, the insurer has an $88.3mn retention above which the state-backed fund writes 90 percent of any loss up to $371.3mn with Assurant picking up the tab for the balance.
“In 2017, our catastrophe reinsurance program proved strong and resilient, absorbing over $600mn in total gross losses, and more importantly Assurant was able to support policyholders during their time of need,” said the president of Assurant’s homeowners brand Michael Campbell.
“This year, we’ve secured comprehensive catastrophe coverage with attractive terms and conditions due to our risk management expertise and strong relationships with our reinsurance partners,” he added.
“Assurant is not only dedicated to providing protection to our policyholders but also to our shareholders, as we gradually reduce our overall net loss retention, in conjunction with our declining exposure, over time.”
Last year, Assurant’s gross losses topped $600mn in the wake of hurricanes Harvey Irma and Maria which pummelled the Caribbean and parts of the US. Of those gross losses, reinsurers picked up the cheque for around half of the total bill.