Heritage Cuts 2026-27 Reinsurance Cost by $63.2M to $367.5M
HRTG•Heritage fully placed its 2026-2027 indemnity-based catastrophe XOL reinsurance program, securing over $2.2 billion of limit, including $712 million of multi-year coverage through two new catastrophe bonds and private market. The program’s $367.5 million cost is $63.2 million lower year-over-year while retaining 90% FHTF participation and stable loss retentions.
1. Full Placement of 2026-2027 Program
Heritage has fully placed its indemnity-based catastrophe excess-of-loss reinsurance program for 2026-2027, covering Heritage Property Casualty, Narragansett Bay and Zephyr Insurance with over $2.2 billion of reinsurance limit, demonstrating strong support from its reinsurance partners.
2. Significant Cost Reduction
The consolidated cost of the reinsurance program is approximately $367.5 million, down $63.2 million from the prior year’s $430.7 million, improving the company’s underwriting leverage and reducing expected catastrophe expense.
3. Coverage Structure and Retentions
External reinsurance tower exhaustion points are set at $1.865 billion for the Southeast, $1.245 billion for the Northeast and $1.00 billion for Hawaii. Heritage’s loss retentions remain at $50 million for the Southeast and Hawaii and $38 million for the Northeast, with 90% participation in the Florida Hurricane Catastrophe Fund.
4. Multi-Year Bonds and Reinsurance Partners
The program includes $712 million of multi-year coverage, comprising $550 million of fully collateralized catastrophe bonds and $162 million placed in the private market, supplemented by capacity from affiliate captive reinsurer Osprey Re to enhance vertical protection.
