Heritage facing $35mn to $40mn hit from CA wildfires

By Chris Munro

Jan 29 - (The Insurer) - Heritage Insurance Holdings is facing a $35mn to $40mn pre-tax hit from losses arising from the California wildfires, while the Tampa, Florida-based carrier believes its Q4 2024 results will include an estimated $57mn impact from Hurricane Milton.

In an update, Heritage said it is currently participating in so-called insurance villages in California, where its staff are meeting directly with wildfire-impacted policyholders to aid their recovery.

“We want to express our deepest sympathies for all those affected by the southern California wildfires,” Heritage CEO Ernie Garateix said.

“Heritage is deeply committed to supporting our customers and communities as they begin the difficult process of recovering from such a devastating event,” the executive added.

Alongside the update on its expected California wildfire losses, Heritage provided details on its fourth quarter 2024 results and the impact of Hurricane Milton.

Heritage said it expects to deliver its best earnings quarter of the year in Q4 2024, with the result coming in ahead of the $18.9mn of after-tax net income it posted in last year’s second quarter.

“This strong result includes an estimated $57.0mn impact from Hurricane Milton in the fourth quarter of 2024, which includes retained catastrophe losses of $40.0mn and a net reinstatement premium of $17.0mn,” explained Heritage.

“Lower than anticipated non-catastrophe accident year losses had a favorable impact on the quarter,” the company added.

As of 21 January 2025, Heritage said it had settled more than 9,000 hurricane claims incurred in 2024, and paid out over $140mn for them.

Heritage said it has also closed approximately 90 percent of the hurricane claims reported to it in 2024.

This publication reported last year that Heritage had estimated losses from Milton would total $57mn.

Garateix at the time said Heritage expected gross losses from Milton would possibly reach the third layer of its reinsurance tower, which started at $450mn and goes up to $914mn.

In the third quarter of 2024, Heritage suffered some $48mn of net catastrophe losses from hurricanes Debby and Helene.