Total liabilities and accumulated surplus $7,202,848 $7,153,042 $7,743,438 $8,309,308 $8,320,077 $7,832,947 $5,093,311

Size: px

Start display at page:

Download "Total liabilities and accumulated surplus $7,202,848 $7,153,042 $7,743,438 $8,309,308 $8,320,077 $7,832,947 $5,093,311"

Pauline Blair
5 years ago
Views:

1 COASTAL ACCOUNT (Formerly the High Risk Account or HRA) SELECTED FINANCIAL INFORMATION STATUTORY ACCOUNTING PRINCIPLES As of December 31, (in thousands) (audited) (audited) (audited) (audited) (audited) (audited) (audited) Statements of Admitted Assets, Liabilities and Accumulated Surplus: Admitted Assets: Cash and short term investments $1,126,621 $1,106,473 $934,528 $1,020,160 $1,283,700 $2,555,062 $3,026,829 Bonds 5,994,873 6,095,816 6,538,417 6,887,398 6,452,999 4,519,054 1,605,517 Investment income due and accrued 46,112 44,462 51,351 57,543 52,912 31,761 7,129 Interaccount receivable (payable) (22,324) (176,743) (28,171) (71,608) (19,712) (16,829) (15,654) Due from investment broker 10 Assessments receivable , , , , ,253 Reinsurance recoverable (102) 367 6,212 2, ,792 11,460 Electric data processing equipment (at cost) Deferred income taxes Other assets (1) 57,422 82,102 76,637 79,240 72,242 65,894 60,767 Total admitted assets $7,202,848 $7,153,042 $7,743,438 $8,309,308 $8,320,077 $7,832,947 $5,093,311 Liabilities and policyholder surplus: Liabilities: Loss reserves $82,686 $92,103 $121,774 $153,121 $155,995 $119,633 $141,480 Loss adjustment expenses 37,169 50,573 47,855 37,636 41,348 25,304 19,956 Unearned premiums (net of unearned ceded) 259, , , , , , ,136 Unearned assessment income 19,326 43,602 85, , ,034 Due to investment broker 5,975 10,121 Accounts payable and other liabilities (2) 296, , , , ,487 78,446 56,886 Interest payable 12,332 17,756 21,059 24,333 27,479 34,938 33,682 Notes payable (net of discount) 3,239,727 3,048,189 3,603,495 4,298,600 4,643,316 4,597,000 2,864,493 Taxes and fees (receivable) payable (630) (1,618) (154) Federal income taxes payable Total liabilities 3,927,450 3,816,011 4,540,975 5,366,396 5,633,855 5,501,032 3,562,956 Accumulated surplus Restricted 20,950 25,348 15,339 11,112 11,726 13,651 14,409 Unrestricted 3,254,448 3,311,683 3,187,124 2,931,800 2,674,496 2,318,264 1,515,946 Total accumulated surplus 3,275,398 3,337,031 3,202,463 2,942,912 2,686,222 2,331,915 1,530,355 Total liabilities and accumulated surplus $7,202,848 $7,153,042 $7,743,438 $8,309,308 $8,320,077 $7,832,947 $5,093,311 (1) Includes premiums receivable, other receivables under reinsurance contracts, and other admitted assets. (2) Includes commissions payable, advance premium and suspended cash, reinsurance payable, and other liabilities Source: Citizens Property Insurance Corporation Citizens Property Insurance Corporation COASTAL ACCOUNT (Formerly the High Risk Account or HRA) SELECTED FINANCIAL INFORMATION STATUTORY ACCOUNTING PRINCIPLES Years ended December 31 (in thousands) (audited) (audited) (audited) (audited) (audited) (audited) (audited) Statements of Operations: PREMIUMS Premiums earned $817,730 $1,066,643 $1,180,761 $1,187,577 $1,148,733 $1,084,141 $1,103,194 Reinsurance ceded (583,261) (590,407) (604,906) (548,744) (380,959) (233,317) (361,092) Premiums earned, net 234, , , , , , ,102 LOSSES AND EXPENSES INCURRED: Losses incurred, net of reinsurance 82,768 74,902 73, , ,534 76,025 25,005 Loss adjustment expenses income 27,273 48,789 51,880 49,860 54,567 40,176 11,411 Other underwriting expenses incurred (2) 141, , , , , , ,901 Total losses and expenses incurred 251, , , , , , ,317 UNDERWRITING INCOME (LOSS) (16,700) 179, , , , , ,785 Net investment income 74,404 96,366 70, ,591 75,003 42,905 62,277 Interest expense, net (125,038) (142,549) (161,338) (176,260) (172,922) (171,345) (115,160) LOC fees & notes issued cost (5,292) (6,008) (15,463) (13,308) Assessment income 19,326 (19,020) 26,166 42,352 35,321 43,387 Takeout bonus expense (net) and other income (expenses) (1,136) 2,498 28,040 2, ,832 3,980 Gain before federal income taxes (54,436) 116, , , , , ,574 Federal income tax benefit NET INCOME (LOSS): ($54,436) $116,942 $223,116 $223,661 $327,963 $461,170 $486,574 Surplus, beginning of period 3,337,031 3,202,463 2,942,912 2,686,222 2,331,915 1,530,355 1,005,795 Prior period adjustment 15, ,482 Assessments (net of distributions) Change in net deferred income tax Additional pension liability (24) (397) (337) (118) (90) 267 Change in other comprehensive income , (118) 23 (50) Change in non admitted assets (7,185) 18,009 20,118 33,221 26,580 38,975 37,769 Surplus, end of period $3,275,398 $3,337,031 $3,202,463 $2,942,912 $2,686,222 $2,331,915 $1,530,355 (1) Includes producer commissions (net), taxes and fees, administrative expenses, and other underwriting expenses. Source: Citizens Property Insurance Corporation

2 COASTAL ACCOUNT (Formerly the High Risk Account or HRA) SELECTED FINANCIAL INFORMATION GENERALLY ACCEPTED ACCOUNTING PRINCIPLES As of December 31, (in thousands) (audited) (audited) (audited) (audited) (audited) (audited) (audited) ASSETS: Cash and cash equivalents $938,045 $7,469 $698,100 $829,711 $1,039,222 $1,314,987 $1,970,600 Short and long term investments 6,252,089 7,257,869 6,904,008 7,252,996 6,852,885 5,895,102 2,805,271 Investment income due and accrued 46,112 44,462 51,350 57,543 52,912 31,761 7,129 Deferred policy acquisition costs 53,115 58,482 57,273 56,366 49,559 Deferred financing costs 62,341 83, , , ,334 Income taxes receivable Premiums receivable and other assets (1) 87,281 57, , , , , ,949 Total assets $7,323,527 $7,366,866 $8,026,261 $8,691,917 $8,642,803 $8,150,075 $5,427,842 LIABILITIES AND NET ASSETS Loss reserves $82,569 $92,003 $121,657 $153,121 $155,995 $119,633 $141,480 Loss adjustment expense reserves 37,169 50,572 47,855 37,636 41,348 25,304 19,956 Unearned premiums 311, , , , , , ,844 Unearned assessment income 19,326 67, , , ,531 Long term debt 3,239,727 3,048,189 3,603,495 4,298,600 4,643,316 4,597,000 2,864,493 Other Liabilities (2) 296, , , , ,237 88,435 56,732 Taxes and fees (receivable) payable (1,618) (154) Interest payable 12,332 17,756 21,059 24,333 27,479 34,938 33,682 Federal income taxes payable Deferred tax liability Total liabilities 3,979,425 3,942,650 4,606,752 5,464,832 5,676,921 5,562,936 3,569,510 NET ASSETS: Restricted 20,950 25,348 15,339 11,112 11,726 13,651 14,409 Unrestricted net assets 3,323,152 3,398,868 3,404,170 3,215,973 2,954,156 2,573,488 1,843,923 Total net assets 3,344,102 3,424,216 3,419,509 3,227,085 2,965,882 2,587,139 1,858,332 Total liabilities and net assets $7,323,527 $7,366,866 $8,026,261 $8,691,917 $8,642,803 $8,150,075 $5,427,842 (1) Includes prepaid reinsurance premiums, premiums receivable (net), premiums receivable from assuming companies, assessments receivable, reinsurance recoverable, other assets, and inter account receivable (payable). (2) Includes reinsurance premiums payable, premiums payable to assuming companies, commissions payable, advanced premium, surcharges payable, and other liabilities Source: Citizens Property Insurance Corporation

4 COASTAL ACCOUNT (Formerly the High Risk Account or HRA) Adjusted GAAP Surplus As of December 31, (in thousands) Retained surplus GAAP basis $3,344,102 $3,424,216 $3,419,509 $3,227,085 $2,965,882 $2,587,139 $1,858,332 Deferred financing costs (62,341) (83,785) (106,580) (124,208) (134,334) Restricted cash FSLSO account (20,950) (25,348) (15,339) (11,112) (11,726) (13,651) (14,409) Unamortized take out bonuses Net assets related to pre event notes (229,367) (309,382) (105,614) Adjusted Surplus $3,093,786 $3,089,486 $3,236,215 $3,132,188 $2,847,576 $2,449,280 $1,709,589

5 Coastal Investments As of Amounts Investments (in millions) Bond Proceeds Tax Exempt Money Market Funds (1) $ 301 Tax Exempt Fixed Rate Municipal Bonds 2,526 Tax Exempt VRDNʹs Municipal Bonds 49 Other Investments ( US Treasury Notes for Debt Service Funds) 646 Total Pre Event Bond Proceeds $ 3,522 Operating Funds Money Market Funds $ 157 Corporates Bonds, Commercial Paper and CDʹs 2,098 Treasury & Agency Securities 1,472 Municipals 45 Total Operating Funds $ 3,772 Total Invested Assets $ 7,294 (1) Includes 2009A 1, 2010A 1, 2011A 1 and 2015A Debt Service Funds

6 As of May 31, 2016, the in force policies and exposure for each category of business are as follows: Policies Account Product Line Inforce COASTAL Personal Residential Wind Only (PR W) 100,578 COASTAL Personal Residential Multi Peril (PR M) 69,919 COASTAL Commercial Residential Wind Only (CR W) 5,086 COASTAL Commercial Residential Multi Peril (CR M) 363 COASTAL Commercial Non Residential Wind Only (CNR W) 12,354 COASTAL Commercial Non Residential Multi Peril (CNR M) 154 Total 188,454

7 Coastal Account Total Policies In Force and Total Insured Value Total Insured Date Total Policies In Force Value (millions) 12/31/2015 (2),(3) 200,842 $82,261 12/31/2014 (2) 282,863 $115,615 12/31/2013 (2) 386,688 $166, Dec ,163 $205, Dec ,161 $228, Dec ,679 $231, Dec ,436 $232, Dec ,200 $239, Dec ,184 $243,788 December 31, 2006 (1) 403,509 $178,314 December 31, 2005 (1) 399,418 $139,106 (1) Total Insured Value increased despite a reduction or marginal increase in total Policies in force due to rate increases implemented in spring of 2005 and in large commercial residential accounts in Builderʹs risk and commercial residential policies typically have a significantly higher average exposure per policy than a personal residential policy. (2) The total policies in force and insured value declined in 2013, 2014 and 2015 largely due to depopulation efforts. (3) Total Insured Value declined in part due to Commercial Residential and Commercial Non Residential policies leaving Citizens outside of the depopulati

8 d spring of 2006 and due to the increase ion process.

9 Total Coastal Policies in Force, DWP and Total Insured Value Period Ending DWP Total Insured Value 31 Dec Total Policies in Force (in thousands) (in millions) ,842 $650,948 $82, ,863 $1,003,191 $115, ,688 $1,174,669 $166, ,163 $1,230,985 $205, ,161 $1,197,823 $228, ,679 $1,115,368 $231, (2) 410,436 $1,031,378 $232, (2) 445,200 $1,125,290 $239, (1) 446,184 $1,219,300 $243, (1) 403,509 $1,274,742 $178,314 (1) DWP and Total Insured Value increased despite a reduction or marginal increase in total Policies in force due to rate increases implemented in spring of 2005 and spring of 2006 and due to the increase in large commerci residential accounts in Builder's risk and commercial residential policies typically have a significantly higher average exposure per policy than a personal residential policy. (2) As of December 31, 2008, Citizens had approximately 68,114 multi-peril policies in force in the HRA with approximately $164.2 million in direct written premium and total insured value of approximately $24.1 billion.

10 Market Share (1) of Citizens Property Insurance Corporation For Residential Policies that Include Wind Coverage Market Share Based on Total Insured Value 21% 24% 20% 15% 9% 6% Based on Premium 27% 30% 26% 20% 13% 9% Notes: (1) Market share calculations are based on residential property exposure and premium for policies that include wind coverage for admitted carriers as reported to the Florida Office of Insurance Regulation via QUASR in a data extract provided to CPIC as of April 12, Any submissions/changes made to QUASR after this date are not reflected in these numbers. Surplus lines carriers are not included in this calculation. QUASR data cannot be separated by CPIC account. (2) The decrease in Citizensʹ Market Share in 2013 through 2015 is consistent with reductions in exposure due to depopulation, Clearinghouse, and Coastal Commercial Residential policies moving to the private/surplus lines markets outside the depopulation process. (3) State Farm Florida filed QUASR data as ʺtrade secretʺ with the Florida Office of Insurance Regulation beginning first quarter In this analysis, Sate Farm Floridaʹs 4th quarter 2013 reported data was used as a proxy for 4th quarter 2014 and 2015 values.

11 Market Share (1) of Citizens Property Insurance Corporation Relative to Other Florida Insurers (2) For Policies that Include Wind Coverage Company Name (2) Market Share as of Dec. 31, 2015 by Total Insured Value by Premium State Farm Florida Insurance Company (3) 7% 6% Citizens Property Insurance Corporation 6% 9% Universal Property & Casualty Insurance Company 6% 8% Federated National Insurance Company 5% 4% Heritage Property & Casualty Insurance Company 4% 5% Notes: (1) Market share calculations are based on residential property exposure and premium for policies that include wind coverage for admitted carriers as reported to the Florida Office of Insurance Regulation via QUASR in a data extract provided to CPIC as of April 12, Any submissions/changes made to QUASR after this date are not reflected in these numbers. Surplus lines carriers are not included in this calculation. QUASR data cannot be separated by CPIC account. (2) Companyʹs listed are the top five based on total insured value (3) State Farm Florida filed QUASR data as ʺtrade secretʺ with the Florida Office of Insurance Regulation beginning first quarter In this analysis, State Farm Floridaʹs 4th quarter 2013 reported data was used as a proxy for 4th quarter 2015 values.

12 Number of Policies Tagged for Depopulation (1) Year Coastal Account , , , , , , , ,519 (1) Tagged for Depopulation counts do not account for any opt out policies reported after the assumption date

13 e

14 Coastal Probable Maximum Losses as of December 31, 2015 (1) Estimated Average Single Event ʺPMLʺ Return Period (billions) 250 years $ years $ years $ years $ years $0.722 (1) PMLs are based on modeled losses as of December 31, 2015 per AIR Touchstone, Version 3.1 reflecting the Standard Sea Surface Temperature (SSST) Event Catalog including Demand Surge, excluding Storm Surge

15 Coastal Regular Assessment Base Regular Assessment Base Year (millions) 2015 Regular Assessment Base/2014 DWP $40, Regular Assessment Base/2013 DWP $37, Regular Assessment Base/2012 DWP $35, Regular Assessment Base/2011 DWP $32, Regular Assessment Base/2010 DWP $30, Regular Assessment Base/2009DWP $30, Regular Assessment Base/2008 DWP $31, Regular Assessment Base/2007 DWP $33, Regular Assessment Base/2006 DWP $34, Regular Assessment Base/2005 DWP $9, Regular Assessment Base/2004 DWP $7,863

16 Coastal Emergency Assessment Base Emergency Assessment Base Year (millions) 2015 Emergency Assessment Base/2014 DWP $41, Emergency Assessment Base/2013 DWP $39, Emergency Assessment Base/2012 DWP $37, Emergency Assessment Base/2011 DWP $36, Emergency Assessment Base/2010 DWP $32, Emergency Assessment Base/2009 DWP $33, Emergency Assessment Base/2008 DWP $34, Emergency Assessment Base/2007 DWP $36, Emergency Assessment Base/2006 DWP $37, Emergency Assessment Base/2005 DWP $11, Emergency Assessment Base/2004 DWP $9,683

17 COASTAL ACCOUNT (Formerly the High Risk Account or HRA) SAP to GAAP Reconciliation As of December 31, (in thousands) Net income (loss) Statutory basis ($54,436) $116,942 $223,116 $223,661 $327,963 $461,170 Adjustments: Change in policy acquisition costs (5,367) 1, ,807 Change in line of credit fees & note issuance costs (4,723) (6,074) (907) 6,595 Change in other financing costs (16,721) (16,721) (16,721) (16,721) Takeout bonuses Change in allowance for doubtful accounts and other income 1,114 (1,152) 1,139 (980) 173 (1,044) Change in unearned assessment income 14,230 17,218 21,620 21,183 Change in 2012 FIGA Assessment income 984 2,675 6,785 (10,690) Change in unrealized gain (loss) on investments (27,751) (21,617) (26,994) 53,916 45,827 32,103 Change in net assets GAAP basis ($80,089) $96,848 $191,465 $261,539 $378,862 $510,093 Accumulated surplus Statutory basis $3,275,398 $3,337,031 $3,202,463 $2,942,912 $2,686,222 $2,331,915 Adjustments: Policy acquisition costs 53,115 58,482 57,273 56,366 Nonadmitted assets, net 38,555 30,254 49,416 68, , ,006 Line of credit fee and note issuance costs 9,391 14,115 20,189 21,095 Takeout bonuses Other financing costs 52,950 69,668 86, ,113 Change in unearned assessment income (23,712) (22,658) (39,877) (61,496) GAAP 2012 FIGA assessment receivable (246) (1,230) (3,905) (10,690) Provision for reinsurance Accumulated unrealized gain on investments 30,384 58,142 79, ,751 52,835 7,008 Total net assets GAAP basis $3,344,102 $3,424,216 $3,419,509 $3,227,085 $2,965,882 $2,587,139

18 Adjusted GAAP for Coastal (in thousands) 31 Dec Dec Dec Dec Dec 11 (Unaudited) (Unaudited) (Audited) (Audited) (Audited) Retained surplus GAAP basis $3,344,102 $3,424,216 $3,419,509 $3,227,085 $2,965,882 Deferred financing costs 62,341 83, ,580 Restricted cash FSLSO account 20,950 25,348 15,339 11,112 11,726 Unamortized take out bonuses Net assets related to pre event notes 229, , ,614 Adjusted Surplus 3,093,786 3,089,486 3,236,215 $3,132,188 $2,847,576

Admitted Assets: Liabilities and policyholder surplus:

Admitted Assets: Liabilities and policyholder surplus: COASTAL ACCOUNT (Formerly the High Risk Account or HRA) SELECTED FINANCIAL INFORMATION STATUTORY ACCOUNTING PRINCIPLES As of December 31, (in thousands) (unaudited) (unaudited) (unaudited) (unaudited)