{"id":5642,"date":"2025-06-23T16:00:33","date_gmt":"2025-06-23T16:00:33","guid":{"rendered":"http:\/\/calebdewey.com\/?p=5642"},"modified":"2025-06-23T16:29:07","modified_gmt":"2025-06-23T16:29:07","slug":"citizens-secures-4-49bn-risk-transfer-target-for-2025-with-lower-rol-for-new-reinsurance","status":"publish","type":"post","link":"http:\/\/calebdewey.com\/index.php\/2025\/06\/23\/citizens-secures-4-49bn-risk-transfer-target-for-2025-with-lower-rol-for-new-reinsurance\/","title":{"rendered":"Citizens secures $4.49bn risk transfer target for 2025 with lower ROL for new reinsurance"},"content":{"rendered":"

Florida’s Citizens Property Insurance Corporation, the state’s insurer of last resort, has cited favourable market conditions as it was able to successfully place its target risk transfer programme of $4.49 billion for the 2025 wind season, which includes $2.89 billion of new coverage from the traditional reinsurance and capital markets.<\/p>\n

Back in April, the Citizens Board approved the carrier to look to secure the $4.49 billion of coverage for its 2025 risk transfer programme, at a maximum cost of $550 million.<\/p>\n

The insurer of last resort has now confirmed that, thanks to “favourable market conditions”, it was able to secure the target amount of reinsurance protection at its renewal, for a total cost of $530.6 million, so below the top-end of the budget.<\/p>\n

This year’s programme is comprised of $1.6 billion of in-force multi-year coverage from 2023 and 2024, and $2.89 billion of new coverage, of which $1.369 billion, or 47% was placed in the traditional reinsurance market, and $1.525 billion, or 53% was placed in the capital markets via Everglades Re II Ltd. (Series 2025-1)<\/a>, the largest catastrophe bond ever issued at the time.<\/p>\n

Interestingly, Citizens has noted that the $2.89 billion of new coverage secured for 2025 has a net rate on line (ROL) of 11.95%, which is a 13.5% decrease on the net ROL of 13.81% for the $3.064 billion of new risk transfer placed for the 2024 programme. For the entire 2025 risk transfer programme, the gross ROL is 11.89% and the net ROL is 11.74%, explains Citizens.<\/p>\n

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The fact Citizens was able to secure the target amount of risk transfer below budget, and with a significant drop in the ROL year-on-year, is another sign of the more favourable conditions for buyers of protection in 2025 when compared with recent years, which reflects some market softening, albeit it from a high base.<\/p>\n

In contrast, last year<\/a>, Citizens was approved to purchase $5 billion of fresh capital from the traditional and capital markets, but only placed $3.064 billion, split $1.964 billion from the traditional market and around $1.6 billion from the capital markets, for a cost of $482 million.<\/p>\n

“The 2025 risk transfer program incorporates strategic elements from prior risk transfer programs, which include: transferring risk alongside the FHCF and transferring single occurrence and annual aggregate risk to protect a portion of surplus for most catastrophic events and thereby eliminates the probability of emergency assessments for a 1-in-100-year event to the citizens of Florida and reduces the probability of a Citizens\u2019 policyholders surcharge to a 1-in-96-year return time,” explains Citizens.<\/p>\n

You can see Citizens’ 2025 risk transfer tower below, which includes surplus, Florida Hurricane Catastrophe Fund (FHCF) coverage, and traditional reinsurance and catastrophe bonds from 2023, 2024, and 2025.<\/p>\n

\"Citizens<\/p>\n

“The 2025 risk adjusted price reflects substantial improvement in market conditions. For coverage placed in 2025, the price is approximately 13.5% lower than it would have cost for similar coverage in 2024,” explains Citizens.<\/p>\n

The post Citizens secures $4.49bn risk transfer target for 2025 with lower ROL for new reinsurance<\/a> appeared first on ReinsuranceNe.ws<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Florida’s Citizens Property Insurance Corporation, the state’s insurer of last resort, has cited favourable market conditions as it was able to successfully place its target risk transfer programme of $4.49 billion for the 2025 wind season, which includes $2.89 billion of new coverage from the traditional reinsurance and capital markets. Back in April, the Citizens […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[10],"tags":[],"_links":{"self":[{"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/posts\/5642"}],"collection":[{"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/comments?post=5642"}],"version-history":[{"count":3,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/posts\/5642\/revisions"}],"predecessor-version":[{"id":5646,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/posts\/5642\/revisions\/5646"}],"wp:attachment":[{"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/media?parent=5642"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/categories?post=5642"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/calebdewey.com\/index.php\/wp-json\/wp\/v2\/tags?post=5642"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}