Rating agency Demotech began to take actions on Florida’s property insurance marketplace yesterday, with a number of changes and withdrawals of ratings evident.
As we reported earlier this morning, the first wave of rating changes from Demotech occurred last night.
Demotech had warned numerous Florida property insurance carriers that they may have faced a ratings downgrade, a move that resulted in a backlash from Florida’s state Insurance Commissioner and CFO.
The moves began with insurer United Property & Casualty Insurance Company (UPC), a carrier of the United Insurance Holdings Corp. group, has been downgraded two notches to an “M” rating by Demotech.
That change was not so surprising given the company has just come through a consolidation of its business in Florida and reorganization of its four carriers into two.
Then, FedNat Insurance Company, a carrier that has also been through a significant upheaval in recent months and had been particularly impacted by catastrophe losses in recent years as well, had its rating withdrawn completely.
After that, Weston Property & Casualty Company, the property insurer that insurance-linked securities (ILS), reinsurance and transportation investment manager Hudson Structured Capital Management (investing as HSCM Bermuda) has a majority stake in, also had its “A” rating withdrawn completely.
At the same time we detailed a number of carriers that were confirmed yesterday.
But we missed two other downgrades, that we’ve now been alerted to.
Demotech has also downgraded the two carriers of Florida Family insurance group.
Florida Family Home Insurance Company and Florida Family Insurance Company have each been downgraded by one notch, from an A’ Prime Demotech rating, to just an A Exceptional rating.
So this won’t affect their ability to write business under the eyes of the mortgage companies, but is another sign of the challenging conditions facing Florida’s property insurer cohort.
Read all of our news and analysis on the Florida insurance and reinsurance market.