HCI Group to Acquire Insurance Business in Three Southeast States from United Insurance Holdings Corp.

GlobeNewswire

TAMPA, Fla., Dec. 16, 2021 (GLOBE NEWSWIRE) -- HCI Group, Inc. (NYSE:HCI), a holding company with operations in homeowners insurance, information technology services, reinsurance and real estate, has reached an agreement in principle with United Insurance Holdings Corp. (NASDAQ: UIHC) to transition all of United’s personal lines insurance business in the states of Georgia, North Carolina, and South Carolina to HCI. The business to be transitioned represents approximately $90 million of annual premiums.

Under the agreement, HCI will provide 85% quota share reinsurance on all of United’s in-force, new and renewal policies in Georgia, North Carolina, and South Carolina from December 31, 2021 through May 31, 2022. In exchange, HCI will pay United a provisional ceding commission of 25% of premium earned and that percentage could increase up to 32% depending on the direct loss ratio results for the reinsured business. HCI will also pay United a catastrophe allowance equal to 9% of premium earned.

As part of the transaction, HCI will pay United a renewal rights ceding commission of 6%, with a portion of the ceding commission paid up-front. In connection with the transaction, United will agree not to compete with HCI for the issuance of personal lines for homeowners business in the three states until July 1, 2025.

The transaction is subject to negotiation of definitive agreements and customary closing conditions, including receipt of all applicable regulatory approvals.

“This transaction offers another great opportunity for HCI,” said HCI Group Chairman and Chief Executive Officer Paresh Patel. “HCI is expanding its relationship with United following a successful transaction in the Northeast. This latest agreement further accelerates HCI towards its growth ambitions, expands the company’s footprint in existing and new states, and brings an established agent network. HCI has the financial strength to support and grow these new business opportunities.”

About HCI Group, Inc.
HCI Group, Inc. owns subsidiaries engaged in diverse, yet complementary business activities, including homeowners insurance, reinsurance, real estate and information technology services. HCI’s leading insurance operation, TypTap Insurance Company, is a rapidly growing, technology-driven insurance company that is expanding nationwide to provide homeowners and flood insurance. TypTap’s operations are powered in large part by insurance-related information technology developed by HCI’s software subsidiary, Exzeo USA, Inc. HCI’s largest subsidiary, Homeowners Choice Property & Casualty Insurance Company, Inc., provides homeowners’ insurance primarily in Florida. HCI’s real estate subsidiary, Greenleaf Capital, LLC, owns and operates multiple properties in Florida, including office buildings, retail centers and marinas.

The company's common shares trade on the New York Stock Exchange under the ticker symbol "HCI" and are included in the Russell 2000 and S&P SmallCap 600 Index. HCI Group, Inc. regularly publishes financial and other information in the Investor Information section of the company’s website. For more information about HCI Group and its subsidiaries, visit www.hcigroup.com.