Hippo successfully completes 2024 reinsurance renewal | Insurance business America
reinsurance
By Jonalyn Cueto
Hippo has announced the successful placement of its 2024 reinsurance program.
“Our reinsurance partners have demonstrated their unwavering confidence in our company by offering improved terms for the second year in a row,” said Rick McCathron, CEO and President of Hippo. “Our continued efforts to mitigate weather-related risks, coupled with our proactive stance to protect homes, have continually led to significant improvements in our loss ratio. This has significantly increased the attractiveness of the Hippo Home Insurance program for reinsurers, many of whom have long-standing partnerships with us.”
CFO Stewart Ellis attributed the success of the placement to the company’s values.
“The success of the placement of our 2024 reinsurance program, as well as our decision to retain a greater portion of the non-PCS exposure and related premium on our balance sheet, reflects our growing confidence in the profitability and predictability of our underwriting results,” Ellis said.
Implementation highlights, announced in a press release, include the following:
- There has been a strategic shift in the company’s approach to reinsurance in relation to proportional reinsurance contracts (Hippo) and non-proportional reinsurance (Hippo). The decision to reduce reliance on proportional reinsurance for the Hippo home insurance program and increase retention of premiums and related non-catastrophic wear and tear losses on the balance sheet was made in anticipation of continued improvements in the wear and tear loss ratio. This decision also reflects the proactive measures Hippo has taken to mitigate volatility.
- The reduction in proportional reinsurance for the Hippo Home Insurance program is expected to mitigate the impact of loss sharing features compared to prior arrangements. At the same time, there was an increase in purchases of non-proportional excess-of-loss (XOL) reinsurance. This included an 11% increase in the XOL limit per event and an expansion of participation to 19 reinsurers (from 14 previously). This placement, in combination with existing catastrophe protection, extends coverage to the upper risk layers and protects against events up to one year Occurs once in 250 years.
Further insight into the reinsurance strategies for the Hippo Program will be provided in the fourth quarter 2023 earnings report scheduled for March 2024 and will be detailed in the 2023 Annual Report on Form 10K to be filed with the SEC.
Hippo is a home insurance group focused on proactive home protection.
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2024-02-01 13:30:04
www.insurancebusinessmag.com
