HCI Group (HCI) Calculates Possible Irma Catastrophe Loss
Zacks Investment Research | Sep 18, 2017 10:33PM ET
HCI Group, Inc. (NYSE:HCI) recently estimated pre-tax catastrophe loss estimates in the aftermath of Hurricane Irma. Homeowners Choice Property & Casualty Insurance Company, Inc., a subsidiary providing homeowners’ insurance in Florida, projects loss between $100 million and $300 million.
HCI Group also anticipated the extent of loss to exceed its $16 million reinsurance retention level. Notably, the tropical storm of Irma has affected regions ranging from Caribbean to Florida. This Florida-based HCI Group will surely then see its underwriting results being badly hurt. However, damages from Irma are hitherto estimated as lower than expected.
The Zacks Consensus Estimate for earnings in the third quarter is currently pegged at 60 cents per share, plummeting 45.5% year over year. We expect the estimates to move downward as analysts incorporate the impact of the catastrophe loss.
HCI Group has been bracing its operations with strategic initiatives. Last quarter, the insurer had completed the reinsurance program for 2017-2018 reinsurance year, improving coverage and lowering risks in the process. The company has also extended its flood insurance activities to nine additional states, which forms part of its strategy to diversify geographically as well as through product mix.
Shares of HCI Group have lost 5.9% year to date, underperforming the Zacks Investment Research
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