Milton/Helene losses fail to breach Oxbridge Re’s reinsurance layers

Cayman Islands-based reinsurance company Oxbridge Re has revealed that ceding insurers have not made any claims related to Hurricanes Helene and Milton, suggesting that losses from the events may not have penetrated the reinsurance layers that are covered by the firm.

However, in a new SEC filing, Oxbridge Re observed that there can be no assurance that claims relating to these hurricanes will not be made.

If claims are made, the firm anticipates that the maximum potential impact on its capital at December 31, 2024, is estimated to be $1.7 million.

Towards the end of 2024, a report from Aon’s Reinsurance Solutions noted that while hurricanes Helene and Milton posed significant challenges for some smaller domestic carriers in Florida and beyond, the insured losses, though substantial, estimated at up to $54 billion for both events, were ultimately less severe than initially feared.

At the time, Aon added that the “healthy” and “well-capitalized” insurance and reinsurance markets are positioned to absorb industry losses.

It would seem Oxbridge Re’s limited exposure, coupled with the relatively manageable insured losses reported by Aon, have unscored the sector’s preparedness for such events.

In Q2 2024, Oxbridge Re reported a net loss of $821,000, significantly larger than the net loss of $85,000 in Q2 2023.

This loss was reportedly driven by a negative change in the fair value of equity securities and other investments during the quarter.

Despite the loss, the company saw a substantial rise in net premiums earned, which increased from $183,000 in Q2 2023 to $564,000 in Q2 2024.

In November last year, our sister publication, Artemis, learned that Oxbridge Re is planning to expand its offering of tokenized reinsurance securities that fund its collateralized reinsurance sidecar vehicle Oxbridge Re NS, with the launch of a second tranche of notes that appear set to have a lower risk-return profile.

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