Florida Office of Insurance Regulation Reaches Agreement with Three Bermuda Reinsurers for New Collateral Requirements
During a Property Insurance Special Session in 2007, Florida lawmakers passed legislation that authorized the Office to establish lower collateral requirements for alien (non-U.S.) reinsurers that are highly-rated and financially sound. The Office has now authorized a total of six reinsurance companies to operate in Florida under modified terms. The three companies approved earlier this year include Hannover Reinsurance, Hannover Insurance (Bermuda), and XL Re Ltd.
"Florida has played a key role in modernizing the U.S. reinsurance market," remarked Insurance Commissioner Kevin McCarty. "These collateral agreements are intended to encourage additional investment in Florida's property insurance marketplace."
The three companies recently approved as eligible reinsurers were organized under the laws of Bermuda. As of the December 31, 2009, all three companies had in excess of the $100 million surplus required under Section 624.610(3)(e), Florida Statutes. Ace Tempest Re reported $5.1 billion in surplus, Hiscox reported $808 million in surplus, and Partner Re reported $3.4 billion in surplus. All three companies also secured a financial rating indicating financial strength from at least two nationally recognized statistical rating organizations and presented information to the Office substantiating their continued financial stability.