Florida property insurers are expected to benefit from a clearer softening in reinsurance pricing at the June 1, 2026 renewals, according to AM Best. Lower catastrophe reinsurance costs could help sustain the positive market momentum that has followed recent legislative reforms.
Florida’s property insurance market was once viewed as dysfunctional because of heavy litigation, assignment of benefits abuse, and claims disputes.
Recent reforms have changed that picture and increased reinsurer appetite for catastrophe-exposed Florida risk.
Even with stronger underwriting results and better market conditions, Florida property insurers remain heavy users of reinsurance capital. AM Best said reinsurance continues to be a major risk transfer tool for carriers operating in the state.
Florida domestic property insurers posted their first underwriting profit in more than a decade in 2024. In 2025, that momentum accelerated, with a $1 bn underwriting gain compared with $235 mn in 2024 and a $132 mn underwriting loss in 2023.
Lauren Magro, senior financial analyst at AM Best, said the improved Florida market reflects lower litigation and less claim solicitation. She said those changes have attracted new writers while giving existing carriers room to recover from earlier losses and use more refined pricing.
The absence of named hurricanes making landfall in Florida during 2025 also helped results. Still, AM Best said the improved performance has changed how capital views Florida property risk.
Reinsurance costs are declining, and capacity is widening as more capital moves into the post-reform market. Florida carriers still depend heavily on reinsurance, but the pricing environment has shifted in their favour.
The June 2025 renewals brought modest rate reductions for Florida carriers. They also drew more reinsurance and insurance-linked securities capital into the state.
After softer conditions at the January and April 2026 renewals, the June 1 renewals are expected to show a larger pricing decline. Florida insurers are seeing both lower costs and more risk appetite from reinsurers.
The catastrophe bond market has already shown that shift. Several Florida-exposed transactions have priced materially lower year-on-year.
AM Best said some carriers could see double-digit price decreases for catastrophe reinsurance coverage. The expected reductions reflect both the lack of a 2025 landfalling hurricane and continued benefits from tort reform.
Some Florida cat bond spread declines have already reached double-digit levels. Those deals often sit in higher reinsurance layers, while price reductions appear less steep closer to working layers of insurers’ towers.
Chris Draghi, director at AM Best, said stabilising profitability and stronger primary carrier balance sheets may shift some negotiating power back to insurers. He also pointed to stronger underwriting guidelines and capital appreciation across the sector.
Future reinsurance pricing still depends heavily on hurricane activity. A major hurricane passing through a large Florida city could change the market quickly.
For now, the reinsurance pendulum has moved closer to buyers of protection. That marks a clear change from the past few years, when reinsurers held much more pricing power over Florida carriers.
