Universal Insurance Holdings, the Florida headquartered insurer, reported that hurricane Helene drove its net loss ratio up in the third-quarter of the year, but its CEO highlighted that its reinsurance retention now drops for a subsequent event, meaning a smaller financial impact expected in Q4, including from hurricane Milton.At the mid-year renewals, , but noted that $1.023 billion of the reinsurance tower would automatically reinstate to provide some multi-event protection.It seems that planning may benefit the insurer for the fourth-quarter of the year, as with Helene and Milton impacts coming very close together, the second-event protection from the reinsurance tower may reduce the net impact to Universal, judging on the CEO’s comments.Universal, for Q3 2024, has reported a net loss of $16.2 million, with higher weather losses largely due to hurricane Helene having driven the net loss ratio to 91.7% for the quarter.

Stephen J.Donaghy, Chief Executive Officer, commented, “We’ve been through many hurricanes in our nearly three-decade history, arming us with the requisite experience to quickly and efficiently get policyholders back on their feet.“Our substantial reinsurance protection and the strong reinsurance relationships that we’ve built over many years provide us with the financial resilience to weather both high frequency and high severity storm seasons.” Donaghy then highlighted the second and subsequent event feature of its reinsurance tower, highlighting that Universal’s retention is expected to be lower for hurricane Milton as a result.

“As we’ve previously disclosed, our consolidated retention drops for subsequent events and we expect a smaller financial impact from weather in the fourth quarter, inclusive of Hurricane Milton,” he explained.Which suggests Universal’s reinsurance partners may take a more significant share and likely quantum of losses with Milton, than they likely have with Helene, while for Universal itself the net and after recoveries impact may actually be lower..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.

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