Citizens Property & Casualty Insurance Company of Florida revealed it is targeting approximately $2.98 billion in private reinsurance coverage for its 2026 risk transfer program.
Coverage will include $1.53 billion of existing private risk transfers and $1.45 billion of new private risk transfers remaining in 2025, with budgeted premiums of approximately $350 million, according to the company.
In this case, Citizens explained that it would allocate 26% of the surplus to the 100-year event.
The insurer said a core element of its strategy to reduce its risk exposure is to transfer risk through reinsurance, thereby limiting or eliminating the likelihood and size of potential assessments for Florida policyholders.
This is typically accomplished through a combination of participation in the Florida Hurricane Catastrophic Fund (FHCF), traditional reinsurance markets, and capital markets.
Citizens noted that by leveraging private reinsurance capacity, it can reduce the likelihood of losses eroding or depleting its surplus and FHCF recovery rates to the point where policyholder assessments are required.
With this in mind, Citizens has outlined the proposed structure for a risk transfer tower in 2026.
Sliver Layer will work alongside FHCF to provide approximately $170 million per year in per-occurrence coverage for personal residential and commercial residential losses in excess of $1.14 billion.
For placement in traditional markets, this layer is designed to operate in conjunction with the mandatory coverage provided by the FHCF.
Above the Silver Tier and FHCF is Tier 1, which will provide $2.81 billion in coverage for personal residential and commercial residential losses from traditional and capital markets.
Among them, traditional reinsurance companies and capital market participants will provide approximately US$1.28 billion in accident insurance and annual total insurance.
The remaining $1.53 billion represents updated capital markets risk transfer placements through Everglades Re II.
This is the second year of multi-year notes originally issued in 2025, which provide overall coverage.
Readers can find more details about this development in our sister publication Artemis, the longest-running news, analysis and data service dedicated to the cat bond and insurance-linked securities (ILS) markets, as well as the non-traditional reinsurance capital, insurance-linked investing and broader alternative risk transfer sectors.
Going forward, Citizens said its staff will work closely with the organization’s traditional and capital markets teams and its financial advisors to evaluate available options for the structure, terms and pricing of the 2026 risk transfer plan, among other related considerations.
Management is expected to make its recommendation to the board in May, at which time it will seek final approval for the 2026 risk transfer strategy.
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