Texas Windstorm Insurer: Finances Sound at Start of Hurricane Season

June 1, 2017

The Texas Windstorm Insurance Association (TWIA) says it is financially sound and ready for the 2017 hurricane season by once again securing $4.9 billion in total funding.

In a media release, TWIA said its 2017 season funding includes a contribution of $147 million to the Catastrophe Reserve Trust Fund (CRTF) as a result of 2016 operations, bringing the CRTF balance to almost $740 million — the highest in the Association’s history.

TWIA also experienced a reduction in projected exposures and minor changes in the hurricane models that led to a decrease in the 100-year Probable Maximum Loss (PML) for 2017 to $4.3 billion from $4.7 billion in 2016.

TWIA’s 2017 reinsurance program, effective June 1, 2017 to May 31, 2018, provides $4.9 billion in total aggregate funding, sufficient to cover a 125-year storm season, or more than 99 percent of all possible storm seasons and in excess of the statutory minimum funding to a 100-year storm. The reinsurance program includes catastrophe bonds, an aggregate amount of $1.1 billion, issued in 2015 and 2017, with staggered expirations in order to provide multi-year stability, diversification, and expanded claims-paying capacity.

TWIA General Manager John Polak said the organization is committed to financial sustainability, providing quality service to policyholders and operating as efficiently as possible.

TWIA said key initiatives are providing continuous improvements to its claims handling processes.

The Texas Windstorm Insurance Association (TWIA) was established by the Texas Legislature in 1971 in response to regional market conditions following Hurricane Celia in August 1970.

Source: TWIA

Topics Catastrophe Carriers Natural Disasters Texas Windstorm Hurricane

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