US main insurance coverage firm Vacationers has additional elevated the quantity of safety it receives underneath its incidence disaster excess-of-loss (XoL) reinsurance treaty to $3.675 billion on the January 1st renewals, however the retention rose to $4 billion as a decrease layer was dropped.
A year ago, Travelers grew the catastrophe reinsurance treaty by a significant 76%, from 2022’s $2 billion, by 76% to offer $3.525 billion of canopy for 2024.
Final 12 months’s association had a $3.5 billion retention, with the decrease layer that includes some reinsurance alongside co-participation.
On the January 2025 renewal, the decrease layer has not been renewed, which means Vacationers primary disaster XoL retention for 2025 stands at $4 billion this 12 months.
As a substitute, Vacationers has now utterly crammed the upper-layer of its tower with non-public market reinsurance, eliminating a 50% co-participation in that layer between $7.5 billion and $8 billion of losses and driving the rise to $3.675 billion of safety.
You’ll be able to see Vacationers’ new 2025 company disaster excess-of-loss reinsurance tower beneath, alongside the prior 12 months treaty:
Vacationers 2025 company disaster tower covers the the buildup of property losses arising from one or a number of occurrences, offering for a restoration of as much as $3.675 billion throughout $4 billion of qualifying losses, in extra of a $4 billion retention and with every qualifying loss after a $100 million deductible.
Vacationers continues to have $575 million of reinsurance in-force from its most up-to-date disaster bond, the Long Point Re IV Ltd. (Series 2022-1) issuance from Could 2022 that matures in the beginning of June 2026.
The insurer additionally has a range of reinsurance in-force that it renews at the mid-year, which final 12 months included extra northeast disaster reinsurance safety.
As a reminder, Travelers opted not to renew its aggregate catastrophe reinsurance treaty in January 2023 and has not added any primary mixture cowl again at this most up-to-date January renewal, it appears.
Read all of our reinsurance renewal news coverage.
