Protecting the Florida Hurricane Catastrophe Fund
The state of Florida has over USD 3 trillion of coastal assets, one of the highest concentrations anywhere in the world. But as the state lies within the infamous “hurricane alley”, its population faces a latent natural disaster risk. In response, the state-run Florida Hurricane Catastrophe Fund (FHCF) established its first-ever reinsurance programme in 2015 and chose Swiss Re as one of its leaders.
Florida has one of the highest coastal value concentrations anywhere in the world but, at the same time, faces a significant hurricane risk. By providing reinsurance protection to the Florida Hurricane Catastrophe Fund, we help strengthen the area’s economic resilience in the face of such disasters.
Although ten years have passed since a major hurricane last made landfall in Florida, the FHCF recognises that it is only a matter of time until one strikes again. As the 2005 hurricane season showed, the financial consequences for local insurers, and ultimately homeowners, can be severe. It is the task of the FHCF to ensure that insurers can pay claims from such extreme events and to reduce the impact on taxpayers.
This is why the FHCF has purchased reinsurance protection for the first time in its 22-year history. By adding USD 1 billion of private capital, it can further build the financial stability it needs to ensure Florida’s economic resilience in the face of disasters.