Heritage Insurance Holdings has finalized its 2025–2026 indemnity-based, catastrophe excess-of-loss reinsurance program for its insurance subsidiaries: Heritage Property & Casualty Insurance Company, Narragansett Bay Insurance Company, and Zephyr Insurance Company.
The program includes US$2.479 billion in reinsurance limit, an increase from the US$2.194 billion placed during the previous year's renewal.
The total consolidated cost of the reinsurance placement is approximately US$430.9 million, up US$7.8 million from the 2024–2025 renewal cost of US$423.1 million.
Heritage outlined external party first-event reinsurance exhaustion points of approximately US$1.6 billion for the Southeast, US$1.1 billion for the Northeast, and US$865 million for Hawaii. These limits may be supplemented through additional coverage obtained from the company’s affiliated reinsurer, Osprey Re.
The previous reinsurance program included over US$70.0 million of limit previously provided by the Florida Reinsurance to Assist Policyholders (RAP) program at no cost to the company. First-event exhaustion points for that cycle were US$1.3 billion for the Southeast, US$1.1 billion for the Northeast, and US$750.0 million for Hawaii.
Compared to the current program, limits have increased across regions, particularly with the Southeast now reaching US$1.6 billion and Hawaii at US$865 million. The program cost has also risen modestly year-over-year, reflecting expanded coverage and the removal of RAP-supported limits.
Heritage CEO Ernie Garateix (pictured above) noted that the limit includes two new catastrophe bonds totaling US$200 million.
“I would like to thank our dedicated reinsurance partners who have supported our business through multiple catastrophic events over the last several years and look forward to their continued partnership as we work to prudently grow the top line,” Garateix said.
The 2025 program features multi-year indemnity-based coverage supported by catastrophe bonds issued by Citrus Re Ltd, a Bermuda-domiciled special purpose vehicle. For the current hurricane season, Citrus Re is providing US$200 million in limit for the Southeast, US$100 million for Hawaii, US$120 million for the Northeast, and US$115 million in combined Northeast/Hawaii coverage.
Loss retention levels for the company are approximately US$50 million in both the Southeast and Hawaii, and US$39.3 million in the Northeast. Retentions for individual insurance entities may be lowered by coverage from Osprey Re.
Florida Hurricane Catastrophe Fund (FHCF) participation remains at 90%, consistent with last year’s program. The entire reinsurance structure is indemnity-based, with no parametric instruments included.
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