American Coastal expands catastrophe program limit to $1.676 billion

By Scott Vincent

May 30 - (The Insurer) - American Coastal Insurance Corporation has grown its core catastrophe program limit by 3.9% for the 2025/26 policy year, with the Florida-based carrier purchasing $1.676 billion of occurrence-based limit.

In an SEC Filing, ACIC said it had an estimated first event limit of $1.33 billion within its renewed occurrence-based structure, an increase of 5.4% on its 2024/25 cat program.

The program has a first event retention of $29.75 million, equivalent to 12.6% of its stockholders’ equity as of December 31, 2024.

Of this, $14.0 million is retained by ACIC with $15.75 million retained by its captive.

This compares with a first event retention of $20.5 million in its 2024/25 program.

The carrier’s second event retention, which assumes a 1-in-100-year event followed by a 1-in-50-year event in the same season, has risen to $18.5 million, an increase of $5.5 million year-on-year.

ACIC’s mandatory Florida Hurricane Catastrophe Fund layer is projected to provide approximately $534.1 million of total Florida-only coverage, attaching at $299.9 million and exhausting at $834.0 million.

The carrier said it had also placed an external quota share at a 15.0% cession rate with an A-plus rated unaffiliated reinsurer, which provides coverage for all catastrophe perils and attritional losses, subject to defined occurrence and aggregate limitations.

Excluding the quota share, the total provisional cost of ACIC’s 2025/26 cat XoL reinsurance programs is approximately $201.85 million, which represents a risk-adjusted open market rate decrease of 12.2% year-on-year.

The maximum potential reinstatement premium in addition to this is $5.9 million, assuming all layers that reinstate are exhausted from a first event.

Perils covered by the program include windstorms that have been named or numbered by the U.S National Hurricane Center.

ACIC had previously outlined its reinsurance plans during its first quarter earnings call.

Separately, ACIC said it placed an all-other perils catastrophe excess of loss program and a catastrophe aggregate excess of loss program on January 1, 2025, as well as an automatic facultative program for non-catastrophe losses effective February 1, 2025.