Applied Underwriters and its Centauri Insurance subsidiaries (Centauri Specialty Insurance Co. and Centauri National Insurance Co.) have affirmed their commitment to underwriting in the Gulf Coast markets despite a predicted severe hurricane season.
The effects of recent carrier insolvencies, voluntary and involuntary moratoria imposed by some stressed carriers, and insufficient or late renewals by many carriers are all threatening the market, Applied Underwriters said. Monoline insurers are at the highest risk since they do not write multiple lines of business.
In contrast, Centauri Specialty Insurance Co. and Centauri National Insurance Co. are writing new business after 2021 with good results. The companies entered 2022 with their A rating affirmed by national rating agencies Demotech, and their reinsurance treaties completed early enough to avoid capacity problems, according to Steve Menzies, chairman of Applied Underwriters.
“We are standing solid in the market for our many brokers and their insureds with no compromises in our financial integrity or product quality, as brokers and consumers anxiously seek coverage – often on tight deadlines for renewals and new policies,” Menzies said. “The demand created by other insurers’ insolvencies and lack of adequate reinsurance financial backing is high, and our staff is meeting it efficiently, with an overall firm delivery commitment that will help sustain the market in the various states around the Gulf and serve our brokers and customers.
“Since acquiring Centauri, we have increased its infrastructural facilities, collaborating with Applied’s national operations platforms that are among the most sophisticated in the world. Applied’s approach in every one of our reinsurance operations across the globe has been to create operational, informational, infrastructural and financial foundations that support our companies in every circumstance. We have set just such a construct at Centauri.”
Jamie Sahara, president of Applied, said the company faced some added pressure as potential problems in the marketplace came to light among other insurers, stemming from a general lack of availability of catastrophe reinsurance and from insolvencies in 2021 and 2022.
“It’s common sense. With so much demand, we only have so much capacity,” Sahara said. “Our first priority is to our renewal customers. So we ask our agents to please understand that we’re going to have to moderate the flow of new business, and we recommend that they get their new business applications in as early as possible.”