Florida-domiciled insurtech HCI Group, Inc., has reported that Q1 2024 consolidated gross premiums earned increased to $256.6 million from $180.1 million in the prior year quarter, which includes $67 million of premium from the assumption of policies from Citizens Property Insurance Corporation.
The firm has reported pre-tax income of $77.4 million and net income of $57 million, or $3.81 diluted earnings per share for Q1 2024, compared with a net income of $17.8 million, or $1.54 diluted earnings per share in Q1 2023.
The company’s premiums ceded for reinsurance in Q1 2024 decreased to $68.1 million from $70.5 million in Q1 2023, representing 26.5% of gross premiums earned compared with 39.2% a year ago.
This decrease in reinsurance cost as a percentage of gross premiums earned was attributed in part to the timing of the large assumption of premiums assumed from Citizens.
Losses and loss adjustment expenses in Q1 2024 were $79.9 million compared with $60.6 million in Q1 2023. The increase in loss expense was due to the growth in policy count and premiums, explains HCI. Although, the gross loss ratio in the first quarter was 31.1%, down from 33.6% a year earlier.
HCI’s policy acquisition and other underwriting expenses in the first quarter decreased to $22.1 million from $22.7 million in Q1 2023 and declined to 8.6% of gross premiums earned from 12.6%, due in part to lower commissions and lower policy acquisition expense related to the timing of the assumption of policies from Citizens.
The net investment income in Q1 2024 was reported at $14.1 million compared to $17.7 million in Q1 2023.
Paresh Patel, Group Chairman and Chief Executive Officer, HCI, commented, “The strong results in the first quarter further reinforce the power of the technology that we’ve built. We’ve successfully added a significant amount of premium with almost no added expense, and we’ve launched a new carrier. The opportunity for the future is to further leverage our technology platform.”
