Legislative reforms support Universal’s 2025-2026 reinsurance strategy

Universal Insurance Holdings announced the completion of the 2025-2026 reinsurance program for its insurance subsidiaries, Universal Property & Casualty Insurance Company (UPCIC) and American Platinum Property and Casualty Insurance Company (APPCIC), effective June 1.

UPCIC and APPCIC set the top of their combined reinsurance tower for a single All States event, including Florida, at US$2.526 billion, representing an increase of US$110 million over the prior year’s program.

As part of the 2025-2026 structure, the companies secured US$352 million in catastrophe capacity with contractually agreed limits that extend into the 2026-2027 treaty year. Of this total, US$277 million sits below the Florida Hurricane Catastrophe Fund attachment point, while US$75 million sits above the FHCF layer.

Universal’s reinsurance program costs have historically represented a significant portion of its operating expenses. For the 2024-2025 period, the total cost of reinsurance was approximately one-third of the estimated direct earned premium for the 12-month treaty term. This figure marked a modest increase from 31.8% in the previous year, reflecting broader market conditions and the company’s expanding exposure base.

As of March 31, Florida accounted for less than 50% of the company’s total insured values across states exposed to the 2025 Atlantic hurricane season. The insurance subsidiaries’ combined first event retention for all states, including Florida, remains at US$45 million, unchanged from the prior year.

Universal reported financial results for the first quarter of 2025 showing total revenues of US$394.9 million, an increase of 7.3% compared to the same period in 2024. Operating income rose 16.2% to US$57.1 million, and net income available to common stockholders increased 23.1% to US$41.4 million.

The company’s management has pointed to the 2022 Florida legislative reforms as contributing to a more stable property insurance environment. Universal noted that the legal changes, including adjustments to claims litigation and assignment of benefits practices, have supported consistent reinsurance placements and pricing aligned with expectations for the 2025-2026 program.

Matthew J. Palmieri (pictured above), chief risk officer, said the company finalized the reinsurance program following an active hurricane season in 2024, which included Hurricanes Helene and Milton.

“We are well prepared for the 2025 Atlantic hurricane season, with another strong reinsurance program and were able to add more traditional market multi-year capacity which goes through the 2026-2027 treaty period,” Palmieri said.

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