Universal Insurance Holdings, a Florida-based growing primary insurance company, reported a combined It reported a ratio of 116.9%, an increase of 6.2 points from the comparative quarter.
The insurer’s net loss ratio increased by 4.7 percentage points to 91.7% in Q3 2024 compared to 875 in Q3 2023. This was primarily due to higher weather-related losses due to Hurricane Helen, partially offset by strong reserve development in the prior year.
The net expense ratio was reported at 25.2%, an increase of 1.5 percentage points from 23.7% in the third quarter of 2023 due to higher policy acquisition costs associated with growth outside of Florida and higher other operating costs.
The net loss available to common stockholders for the third quarter of 2024 was $16.2 million, an increase from $5.9 million in the prior year period. Adjusted net loss was $20.8 million, compared with $4.6 million in the year-ago period. The insurer said the increase in adjusted net loss was primarily due to lower underwriting income, partially offset by higher net investment income and fee income.
Universal’s revenue for the quarter was $387.6 million, an increase of 7.6% year-over-year, with core revenue of $381.4 million, an increase of 5.4% year-over-year. This growth was driven by increases in net premiums received, net investment income, and fee income.
Direct premiums received by insurers were reported to be $574.4 million, up 8% year over year, with increases of 2.1% in Florida and 32.9% in other states. This growth reflects increased insurance coverage, interest rate increases, and inflation adjustments.
Direct premiums earned were $507.7 million, an increase of 7% compared to the prior year period due to higher direct premiums received over the past 12 months.
The ceded reinsurance premium rate for the third quarter of 2024 was 31.9%, up from 30.2% in the same period last year. This is primarily due to the replacement of the policyholder assisted reinsurance (RAP) layer offered by Florida with private market coverage.
Universal reported net premiums written for the quarter of $345.7 million, an increase of 4.4% year over year. This was due to an increase in direct premiums written, partially offset by higher ceded reinsurance rates.
Finally, net investment income was $15.4 million, up from $12.8 million in the prior year period, due to higher debt reinvestment yields and higher invested assets.
The insurer reported commissions, premiums and other income of $20.3 million, an increase of 12.7% year over year. This was facilitated by the replacement of the RAP layer with private market coverage in 2024 and the replacement of catastrophe bonds with traditional reinsurance coverage. -2025 Program.
The operating loss margin for the third quarter of 2024 was 4.3%, compared to 1.7% in the year-ago period. The adjusted operating loss ratio was 5.9%, up from 1.3% in the same period last year.
Stephen J. Donaghy, Chief Executive Officer of Universal Insurance Holdings, commented: “Our hearts and thoughts go out to those affected by recent disasters, including Hurricanes Debbie and Helen in the third quarter and Hurricane Milton in the fourth quarter.
“We have been through many hurricanes in our nearly 30-year history and have the experience necessary to get our policyholders back on their feet quickly and efficiently. The strong reinsurance relationships we have built over many years provide us with the financial resilience to weather both high-frequency and high-severity storm seasons.
“As previously disclosed, subsequent events have reduced our consolidated holdings and we expect the financial impact of the weather in the fourth quarter, including Hurricane Milton, to be less.Non-catastrophe underwriting trends continues to improve and we are very encouraged as we look to the future.
“On a separate note, we opened our 19th state, Wisconsin, earlier this month. We continue to expand into new markets, diversify our operations and expand our addressable markets. We are very pleased to be able to offer our insurance products there.”
