Allstate adds Nationwide cover but reduces Florida reinsurance tower at mid-year renewal

US primary insurer Allstate opted to shrink the size of its 2024-2025 Florida excess catastrophe reinsurance program at the mid-year reinsurance renewals, and also added $90 million of limit to the top of its Nationwide coverage.

This is now the second year running Allstate has elected to reduce its Florida specific reinsurance coverage, while the carrier has continued to expand its protection across the rest of the US.

As we wrote last year, Allstate dropped the top of its Florida tower from $1.83 billion to $1.28 billion for 2023-2024, and a further reduction took place at the June 1st, 2024, renewals, as the insurer’s 2024-2025 Florida excess cat reinsurance tower now tops out at $890 million.

The program’s retention has also come down from $40 million to $30 million, and above this sits a $74.5 million Sanders Re II Ltd. (Series 2024-2) catastrophe bond alongside reinsurance that would fill the same layer should the cat bond be eroded.

Above this, a traditional reinsurance layer attaches at $104.5 million up to $340 million, so providing $235 million of reinsurance, and the firm explains that the FHCF inures to the benefit of this layer.

Above this layer is the three same catastrophe bonds from the 2023 tower, but with different attachment points for 2024-2025.

You can see Allstate’s Florida reinsurance tower for 2024-2025 below.

Allstate also added $90 million of reinsurance limit to the top of its per occurrence 2024-2025 Nationwide Excess Catastrophe Reinsurance Program at the June 1 renewals.

Back in May, Allstate disclosed that it had raised the top of its Nationwide excess cat reinsurance tower for 2024 to just over $7.9 billion, after retentions of $500 million to $1 billion.

After the June renewal, the tower still provides coverage for events up to $7.9 billion of loss less retentions of $500 million and $1 billion, but now includes an additional $90 million annual contract at the top of the tower, meaning that this top layer is now $190 million of limit excess of a $7.7 billion retention to run until March 31 2025.

Also at the June renewal, Allstate extended its California focused excess and surplus (E&S) earthquake reinsurance arrangement, with the three-year agreement now extending to June 30, 2025, while it continues to provide reinsurance on a 100% quota share basis with no retention.

Further, the insurer renewed its National General Lender Services Standalone Program, which consists of one single-year term contract expiring May 31, 2025, providing one limit of $70 million in excess of a $70 million retention and one limit of $195 million in excess of a $140 million retention. Last year, this program provided one limit of $80 million in excess of a $60 million retention and one limit of $175 million in excess of a $140 million retention.

For its National General Reciprocal Excess Catastrophe Reinsurance Contracts, Allstate renewed this program on the same terms as the previous year, securing one annual term contract expiring June 30, 2025, which provides one limit of $50 million in excess of a $15 million retention, one limit of $160 million in excess of a $65 million retention and one limit of $235 million in excess of a $225 million retention.

Finally, Allstate’s Kentucky Earthquake Excess Catastrophe Reinsurance Contract was renewed to provide limit of $28 million in excess of a $2 million retention, with one reinstatement of limits, and is 95% placed, which is the same as last year.

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