Reinsurance is simply insurance for insurance companies–back-up coverage. For risk management, all Florida homeowners insurance companies purchase reinsurance to transfer some of the risk to reinsurers. If a hurricane makes landfall, and depending on the amount of reinsurance a company purchased, recovery funds from reinsurers become available to help the insurance company pay claims. However, if the company does not purchase enough reinsurance, it may not be able to pay its claims and could become insolvent.
Financial Stability
Since 2005, we have been delivering on our promise to be there for our customers storm after storm, year after year®.
Delivering on Our Promise
Stability + Longevity
It’s imperative to us that we are able to pay our customers’ claims. By analyzing our exposure to storms using approved hurricane models, we ensure our level of reinsurance purchase exceeds every modeled loss contained in the hurricane model’s entire event catalogue.
This is why we have purchased enough reinsurance to cover a single large event – more than 4 times the cost to the Company if Hurricane Irma or Ian were to make landfall today. We do this to ensure the financial strength to be there for our customers storm after storm, year after year®.
Protection + Financial Strength
Reinsurance
Reinsurance is back-up disaster coverage, or insurance for insurance companies. It is the key to homeowners insurance companies’ financial stability. Every year, Florida homeowners insurance companies purchase reinsurance and most programs are in place by June 1.
- Security First Insurance has more than $1.0 billion in total reinsurance coverage available to pay customers claims for multiple storms in a single year.
- $82 million in surplus (capital) to cover the amount of retention we must first pay to gain access to recovery funds. Retention is the deductible we are required to pay. For 2024/2025 our net retention is $8.6 million per event.
- We purchase more than the recommended amount of reinsurance, up to 1 in 247-year event, to ensure our ability to pay claims for multiple storms in a single hurricane season – far exceeding the recommended minimum.
Florida regulators suggest insurance companies purchase, at minimum, enough reinsurance to pay all policyholder claims caused by a large catastrophic event (one in 130-year) and one 50-year event after a 100-year event.
At a Glance
Key Figures
We have purchased enough reinsurance to cover a single large event—more than 4 times the cost to the Company if Hurricane Irma or Ian were to make landfall today.
Total Reinsurance
$1.02B
Total reinsurance coverage purchased for multiple events
Reinsurance Available
$751M
Reinsurance available to pay claims for a single large event
Surplus
$82M
Surplus to cover retention
Frequently Asked Questions
What Is Reinsurance?
What is reinsuranace?
How much reinsurance should companies purchase?
Not all insurance companies are required to purchase the same amount. Important: this is the major reason all Florida home insurance companies are not equally as strong. Each company determines how much reinsurance they purchase by using hurricane models to estimate their exposure to hurricane losses. Some home insurance providers only purchase the minimum amount of reinsurance suggested by Florida regulators. This is supposed to be enough to withstand a single large event and two smaller events. Mother Nature, however, is not predictable. As the 2004 hurricane season showed, a multitude of storms can occur in a single year.
How do I get this information from other Florida home insurance companies?
Not all companies publish detail about their reinsurance program on their website. If you’re having trouble locating this information, talk with your insurance agent and call the insurance company to ask them how many hurricanes they can withstand. Do they have enough reinsurance to endure another 2004 hurricane season with four storms?
How often should I ask about a company’s reinsurance program?
Home insurance companies purchase reinsurance every year. Most companies have a program in place by June 1st, before the start of the hurricane season. June 1st, or just prior to your policy’s renewal, is a good time to conduct your evaluation. A company may be financially stable at the time you purchased your policy, but this doesn’t mean they will be as financially strong when it’s time to renew. In fact, if the company were to poorly manage their growth, they may not have the funds necessary to purchase adequate reinsurance coverage.
We’re Number 1
For the fourth consecutive year, Security First Insurance has been chosen as MarketWatch Guide’s Home Team choice for hurricane protection. If you are a homeowner in Florida, why else would you choose a homeonwers insurance company, except for its hurricane protection?