[Liability Insurance] FW: Press Release: Hurricanes, water losses, AOB prompt reinsurance changes

Wed Mar 27 08:57:15 PDT 2019

Please see below and attached thanks to Jay Mussman.

Scott P. Pence | Carlton Fields
Board Certified in Construction Law by The Florida Bar
Direct: 813.229.4322 | Fax: 813.229.4133
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
bio<http://www.cfjblaw.com/spence/> | vcard<http://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=7> | linkedin<http://www.linkedin.com/in/pencescott>

From: Mussman, Jay D. <jmussman at daypitney.com>
Sent: Wednesday, March 27, 2019 11:55 AM
To: Pence, Scott <spence at carltonfields.com>
Subject: Press Release: Hurricanes, water losses, AOB prompt reinsurance changes

Please share

Thank you

Jay D. Mussman | Attorney at Law | Attorney Bio<http://www.daypitney.com/professionals/M/Mussman-Jay-D>

[cid:image001.jpg at 01D4E493.EDB22EB0]<http://www.daypitney.com/>

Mizner Park Office Tower | 225 NE Mizner Boulevard, Suite 350 | Boca Raton FL 33432-4078
t (561) 537 4934 | f (561) 952 4267 | m (561) 862 8107

396 Alhambra Circle | North Tower, 14th Floor | Miami FL 33134
t (561) 537 4937 | f (305) 373 4099

jmussman at daypitney.com<mailto:jmussman at daypitney.com> | www.daypitney.com<http://www.daypitney.com>
BOSTON<http://www.daypitney.com/about/offices/boston>  |  CONNECTICUT<http://www.daypitney.com/about/offices>   |  FLORIDA<http://www.daypitney.com/about/offices>   |  NEW JERSEY<http://www.daypitney.com/about/offices/parsippany>   |  NEW YORK<http://www.daypitney.com/about/offices/new-york>   |  WASHINGTON, DC<http://www.daypitney.com/about/offices/washington-dc>    [Day Pitney LLP on Facebook] <http://facebook.com/DayPitney>   [Follow Day Pitney LLP on Twitter] <http://www.twitter.com/daypitneyllp>   [Day Pitney LLP on Linkedin] <https://www.linkedin.com/company/day-pitney-llp>
From: Newsroom [mailto:Newsroom at citizensfla.com]
Sent: Wednesday, March 27, 2019 11:51 AM
Subject: Press Release: Hurricanes, water losses, AOB prompt reinsurance changes

[[EXTERNAL EMAIL]]
________________________________

[cid:image003.jpg at 01D4E493.5FE6E580]

FOR IMMEDIATE RELEASE
March 27, 2019

Contact: Michael Peltier
(850) 513-3774
(850) 264-7702 (cell)

Hurricanes, water losses, AOB prompt reinsurance changes

MAITLAND, FL – Citizens Property Insurance Corporation will seek approximately $200 million in traditional reinsurance coverage for the 2019 hurricane season to protect surplus exposed to storm risk in areas located away from the coast. This follows mounting losses from hurricanes, nonweather water-loss claims, litigation and assignment of benefits abuse.

For the first time since 2005, Citizens will purchase traditional reinsurance for its Personal Lines Account (PLA), which is comprised of 301,000 residential policies, most of which are not located along the coast. The reinsurance coverage will reduce Citizens’ PLA surplus exposure from 62 percent to 52 percent in the event of a 1-100 year storm.

“After significant losses in the Personal Lines Account from Hurricanes Irma and Michael, along with nonweather losses and assignment of benefits, the Personal Lines Account surplus has decreased significantly and is now exposing much more of its surplus for a 1-100 year storm,” Jennifer Montero, Citizens Chief Financial Officer, told its Board of Governors on Wednesday.

Since 2015, Citizens has incurred net operating losses in the PLA. Along with claims from Hurricanes Irma and Michael, these net operating losses are driven by nonweather-related water claims, assignment of benefits abuse and increased litigation. For 2018, the PLA experienced a net loss of $135.9 million.

Traditional reinsurance coverage for the Personal Lines Account will be part of a $1.6 billion risk transfer package<https://www.citizensfla.com/documents/20702/9571058/20190327+04Aa+Layer+Charts.pdf/d4ef388d-cd54-42b1-bcde-4ddc6479da19> being assembled for the 2019 hurricane season, which begins June 1. Citizens plans to have $1.4 billion in coverage established for the Coastal Account. This includes $880 million in traditional reinsurance and catastrophe bonds purchased in 2017 and 2018, which remain in place for the 2019 season.

###

________________________________
This message contains PRIVILEGED AND CONFIDENTIAL INFORMATION intended solely for the use of the addressee(s) named above. Any disclosure, distribution, copying or use of the information by others is strictly prohibited. If you have received this message in error, please notify the sender by immediate reply and delete the original message. Thank you.

**********************************************************************************************************
________________________________
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/attachment-0001.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image003.jpg
Type: image/jpeg
Size: 10888 bytes
Desc: image003.jpg
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/image003-0001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.jpg
Type: image/jpeg
Size: 5097 bytes
Desc: image001.jpg
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/image001-0001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.jpg
Type: image/jpeg
Size: 1157 bytes
Desc: image002.jpg
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/image002-0001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image004.png
Type: image/png
Size: 1340 bytes
Desc: image004.png
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/image004-0001.png>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image005.jpg
Type: image/jpeg
Size: 1216 bytes
Desc: image005.jpg
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/image005-0001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: 03.27.2019 Press Release_Hurricanes water loss AOB prompt risk transfer changes.pdf
Type: application/pdf
Size: 140900 bytes
Desc: 03.27.2019 Press Release_Hurricanes water loss AOB prompt risk transfer changes.pdf
URL: <http://mailman.fsr.com/pipermail/liability_insurance/attachments/20190327/8df5ae5b/03.27.2019PressRelease_HurricaneswaterlossAOBpromptrisktransferchanges-0001.pdf>