Slide building on presence in Florida, picks up 91K policies from UPC
Insurance reforms passed in 2022 are a ‘game changer’ for Florida’s market and helped move the needle on this deal, Slide CEO tells PC360.
Insurtech Slide is picking up 91,400 home insurance policies in Florida from United Property & Casualty Insurance Company (UPC).
The acquired policies represent $272 million in annual premiums, and this deal brings Slide’s total in-force premium value to $560 million, the insurtech reports. This move comes less than a year after Slide picked up nearly 150,000 policies from St. Johns Insurance Company, which was going through the liquidation process.
As of November 1, 2022, UPC had approximately 142,785 policies in Florida, according to documents on file with the Florida Office of Insurance Regulations (FOIR). During each of the past five years, UPC experienced losses exceeding $35 million, and during Q3 2022 the company reported a net underwriting loss of $169 million.
According to Bruce Lucas, Slide CEO and co-founder, the deal is a strong strategic fit with the company’s current portfolio in the state as the acquired policies have good geographic distribution.
“I think we are only taking about 50 policies in total in Miami-Dade and Broward counties, which we like. These are newer roofs, newer houses and no open claims,” Lucas tells PropertyCasualty360.com. “We underwrote this portfolio over the last couple of months and these represent, in my opinion, the best of the best policies that UPC has to offer.”
In addition to the quality of the risk being acquired, Lucas notes Slide is in a very unique capital position, as the $100 million holding company behind it easily allowed the insurtech to make this traction.
“I don’t think there is a lot of excess liquidity in the Florida market outside of Slide,” he adds.
As part of the deal, Slide is also acquiring UPC’s intellectual property and data set of more than $1 trillion total insured value (TIV). Once the deal is final, the insurtech’s dataset of approximately $6 trillion TIV will have more than 20 years of historical claims information.
Reforms bolstering confidence in Florida’s market
In related news, Slide recently began accepting new business in Florida, making it the first insurer to do so in 2023, the company reported. While many insurance companies are seeking to limit their exposure in Florida’s home insurance sector, Lucas feels now is the time to grab market share as recent insurance reforms passed in the state will be “game changers.”
“I can’t stress this enough; I believe those reforms will absolutely stabilize the Florida market,” Lucas says. “I’ve been waiting for these reforms for the better part of a decade, and I’ve watched as the legislature nibbled around the edges of the core problems in Florida for years.”
Lucas explains these core problems included rules for the one-way attorney fees, which were changed this past May, assignment-of-benefit rules, a long statute of limitations and other unique insurance provisions that existed only in Florida.
“The (insurance reform) package that was approved in December brings earth-shattering changes to this market,” Lucas says. “It gives me the confidence to expand my footprint in Florida, especially since all of the policies we are taking on from the UPC transaction will come under the new statutes. They are totally cleansed of the old rules and that makes us a vastly superior underwriting risk for reinsurers.”
Concerning reinsurance, Slide has so far met with around 50 reinsurers, who have been decidedly positive on the UPC transaction, according to Lucas.
“That gave us additional confidence that we would get support from the reinsurance community,” he says.
This past August when UPC announced plans to withdraw from Florida’s market, it also said it intended to withdraw from Texas and Louisiana home insurance sectors. Lucas said the company is not looking to pick up policies from UPC in those states, but did hint Slide would be expanding its geographic footprint later this year.
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